The latest move on that front comes from Simple Energy, the software startup that connects utility customers to energy savings via social media and contests. On Monday, the San Diego, Calif.-based startup announced that Bud Vos, former CTO of Comverge, was joining as CTO and senior vice president of utility sales.

Vos has a long track record at the head of Comverge’s effort to convert its commercial and residential demand response programs to next-generation software platforms that allow them to connect to the greater smart grid. He’s also got the utility relationships from Comverge’s longstanding demand response contracts.

Comverge, of course, has been less than successful in making the transition from the old-school, pager and radio-operated direct load control model to the new smart meter-enabled, customer behavior-driven paths to energy efficiency. In March, Comverge sold itself to private equity firm H.I.G. Capital for $ 49 million, a fraction of the market share it commanded from its 2007 IPO until just last year.

Part of Comverge’s problem stemmed from a 2010 smart thermostat recall in Texas that stifled its residential demand response business growth. Even without recall problems, though, the number of smart grid-connected thermostats out in the market hasn’t grown nearly as fast as backers of the technology have hoped it might, although we’ve seen some sizable pilots emerge.

But Simple Energy’s approach to homeowner energy efficiency needs only a home Internet connection and a utility data feed — and while smart meters help, they aren’t necessary. Opower, Efficiency 2.0 and Tendril are some other startups with similar approaches to getting utility customers involved in their energy use. The first two have shied away from pricey in-home gadgets, while Tendril has backed away from its attempts to get them adopted by utilities, for the most part.

Some other noteworthy green jobs news of last week:

- MEMC, maker of polysilicon and silicon wafers for the chip and solar industries and owner of SunEdison, announced Thursday that CFO Mark Murphy had resigned to return to his previous employer, Praxair. Murphy will be replaced by Brian Wuebbels, a five-year veteran of MEMC who formerly worked at Honeywell and General Electric.

MEMC had reported disappointing first-quarter results the previous week, and news of Murphy’s departure drove down its already-sagging share price even further late last week. He’s not the first MEMC executive to leave — Ken Hannah, president of its solar energy business, left the company on May 6 to become the CFO of J.C. Penney In April the company had to issue a statement to refute rumors that CEO Ahmad Chatila was leaving.

- Pythagoras Solar, the Israeli startup with a transparent solar module technology, last week hired Andrew Jensen as president of North American operations. Jensen, who previously spent a decade with Cardinal Glass, will be working with partners such as Guardian Industries, which wants to get the solar window product into building-integrated photovoltaic (BIPV) markets.

- Oree, the planar LED lighting company, has put board chairman Peter van Strijp in the CEO position, replacing founder and CEO Eran Fine. The Israel-based maker of super-thin “LightCell” materials has been seeking channel partners for its technology, and presumably van Strijp, a former CEO of Philips Solid State Lighting business group, can offer entrée to those potential partners.

- Biofuel startup ZeaChem announced Tuesday that it had hired Peter Chessbrough as its new CEO, replacing Andy Victor, who stepped down to become vice president of finance. Chessbrolugh previously served as CFO of Denver-based IT consulting services company Ciber. The Lakewood, Colo.-based company hasn’t made much news lately on its plans to bring its genetically modified organism, derived from microbes from termite guts, to converting cellulosic materials like wood and straw into precursors for biofuels. While it’s on a short list of companies the U.S. government is hoping will ramp up production to meet its 2012 cellulosic biofuel mandates, nobody’s holding their breath waiting for that figure to be reached.

- EnerG2, maker of carbon nanomaterials for energy storage applications, landed a high-profile board member earlier this month. That’s Bob Lutz, the former executive vice chairman of General Motors who introduced the Chevy Volt as the first mass-manufactured plug-in hybrid car in the United States.

Lutz said in a prepared statement that he’s looking to EnerG2 to provide the breakthroughs the automotive industry needs to lower the costs and improve the performance of energy storage systems that can make the electric car a future mass-market reality. EnerG2 recently opened its first factory in Albany, Ore., though it hasn’t named customers for its materials yet.

- One final note comes from the crossover between the green technology space and the information technology space. Gary Bloom, the former CEO of eMeter who led the San Mateo, Calif.-based startup’s sale to Siemens last year, has been named CEO of MarkLogic, a big data applications firm. Bloom is also the former CEO of Veritas Software and a high-level executive at Oracle and Symantec, so he’s returning to his roots after his 20-month stint bringing eMeter to the point of sale.

Go Green

The decision involves two questions, a legality explicitly before the commission and an implied dispute between the state’s three investor owned utilities (IOUs) and renewables advocates.

California has a net energy metering (NEM) program that allows owners of distributed generation (DG) systems of up to one megawatt in capacity, like small wind turbines, combined heat and power systems and rooftop solar systems, to reduce their electricity bills.

For the kilowatt-hours they send to the grid, system owners’ meters turn backwards as they are credited at the same retail rate they pay for the kilowatt-hours they consume.

When California established its NEM program in 1995, it imposed a 0.1 percent cap but used the ambiguous language of “aggregate customer peak demand” to define what the total megawatts of net metered systems should be divided by to calculate the cap percentage. And that calculation remained undefined, even as the CPUC expanded the cap to today’s five percent.

The differing methods used by the IOUs to calculate the bottom term of the cap equation, and the differing percentages thereby obtained, were recently observed by the Interstate Renewable Energy Council (IREC) which, among its other activities, acts as a watchdog group on U.S. net metering programs. IREC filed a motion asking the CPUC for clarity. Commission President Michael Peevey issued a proposed decision April 5.

In it, he noted the legislature had “several goals” in creating the NEM Program, “including encouraging substantial private investment in renewable energy resources and stimulating in-state economic growth.”

He pointed out several differences in how the IOUs calculate the percentage of their NEM but noted one key commonality: PG&E, SCE and SDG&E all use “coincident” peak demand. Renewables industries advocates argue vehemently for “non-coincident” peak demand.

Coincident peak demand is the designated period when all sectors (residential, commercial and industrial) reach their maximum electricity consumption together. It is the time period when the state’s consumption peaks.

Non-coincident peak demand is the sum of the peaking demand in the sectors. Residential peak is typically late afternoon, commercial peak is early midafternoon, and industrial peak can be at night. It is a larger number because that sum of peaks at different time periods is greater than the total peak demand at any one time of the day.

The installed DG capacity eligible for NEM is same. Dividing it by the peak demand number gives the cap percentage. When that number gets to five percent, the utilities are theoretically off the hook. So they want that bottom number to be smaller. Renewables advocates want just the opposite. As long as the number doesn’t get to five percent, renewables developers have what one called their “backbone” incentive in place.

The question before the CPUC is the intent of the law. Here’s what Peevey wrote: “the phrase “peak demand” is used to refer to coincident peak demand in multiple occurrences in the Pub. Util. Code…”

And, “…the words “aggregate customer” would be superfluous if the Legislature had intended “aggregate customer peak demand” to mean coincident peak demand…”

And, “Use of the phrase “aggregate customer peak demand” in § 2827 of the Pub. Util. Code to mean coincident peak demand when the phrase “peak demand” is used elsewhere in the Pub. Util. Code for that purpose would constitute the use of inconsistent and confusing terminology by the Legislature.”

These observations led Peevey to conclude that, “The Legislature did not intend “aggregate customer peak demand” to mean coincident peak demand…It is reasonable to interpret “aggregate customer peak demand” as meaning the aggregation of individual customer peak demands, i.e., customers’ non-coincident peak demands…[and] SCE, SDG&E, and PG&E should use the aggregation of customers’ non-coincident peak demands to calculate their caps on NEM participation…”

In comments filed by their attorneys, the IOUs dispute these conclusions. PG&E wrote that “the best choice for the denominator for calculation of the five percent cap is the highest peak ever achieved in the utility service territory…For PG&E, at least to date, this was 20,883 megawatts reached on July 25, 2006…”

PG&E’s filing also complicates the basic dispute by suggesting a change in the way the top number is calculated and concludes, “PG&E estimates that reversing these two decisions would reduce the amount of generation that can fit under the cap by about ten percent, although the exact amounts will vary depending on participation in each group. PG&E recognizes that this means more net metering. However…[it] is the better measure of the impact on the grid…”

By raising the issue of the impact of renewables on the grid, PG&E opened the door to the implicit debate between the IOUs and renewables advocates.

The utilities point out that of the three parts of the standard electricity bill, only one covers the price of electricity generated. The other charges cover the costs of delivering electricity through the transmission and distribution infrastructure. When NEM customers’ bills are reduced by the retail rate, they escape paying their fair share of costs for infrastructure they use as much as non-NEM customers.

And, the utilities say, it shifts costs to other ratepayers.

More on the costs and benefits of NEM in the next installment in this series.

Go Green

But before Romney details his plan, he takes some swipes at the Obama administration's energy plan:

As the Obama administration wages war against oil and coal, it has been spending billions of dollars on alternative energy forms and touting its creation of “green” jobs. But it seems to be operating more on faith than on fact-based economic calculation. To begin with, wind and solar power, two of the most ballyhooed forms of alternative fuel, remain sharply uncompetitive on their own with conventional resources such as oil and natural gas in most applications. Indeed, at current prices, these technologies make little sense for the consuming public but great sense only for the companies reaping profits from taxpayer subsidies.

Romney accuses the Obama administration of having an "unhealthy obsession with green jobs" and cites studies which show that green jobs might actually hurt employment rather than help it. Obama's delay of the construction of the Keystone XL pipeline is also labeled a job killer; the document cites an arguable figure of 100,000 jobs lost in not constructing the pipeline that would originate at the Alberta Tar Sands.

Here is Romney's energy platform, excerpted from his website.

What’s at Stake

Producing more domestic energy would create good jobs and bolster local economies in a wide variety of energy-producing regions that effectively “export” their product to the rest of the country. While countless jobs are engaged in the actual energy-production process, they are a small fraction of the full workforce that benefits. For instance, before the first barrel of oil is pumped out of the ground, entire industries are hard at work creating the equipment and providing the services used in drilling, production, and the long chain of supporting industries that brings energy from inside the earth to the consumer.

The ripple effects into the non-energy sectors of the economy are commensurately important. If instead of sending hundreds of billions of dollars overseas we can send them to our own energy-rich centers, the nation as a whole will experience the economic benefits that we currently see other countries enjoying at our expense.

Obama’s Failure

Unfortunately, the first three years of the Obama administration have witnessed energy and environmental policies that have stifled the domestic energy sector. In thrall to the environmentalist lobby and its dogmas, the President and the regulatory bodies under his control have taken measures to limit energy exploration and restrict development in ways that sap economic performance, curtail growth, and kill jobs.

The Obama administration’s energy policy has been simply incoherent. For instance, it has blocked off-shore drilling in U.S. waters while applauding increased drilling off the coast of Brazil. Similarly, it has blocked construction of a pipeline that would bring Canadian oil to the United States, knowing full well that the result would be Canadian oil flowing to China instead. And it has pursued numerous regulations that would drive up energy prices while destroying millions of jobs.

As the Obama administration wages war against oil and coal, it has been spending billions of dollars on alternative energy forms and touting its creation of “green” jobs. But it seems to be operating more on faith than on fact-based economic calculation. The “green” technologies are typically far too expensive to compete in the marketplace, and studies have shown that for every “green” job created there are actually more jobs destroyed. Unsurprisingly, this costly government investment has failed to create an economic boom.

Mitt’s Plan

As president, Mitt Romney will make every effort to safeguard the environment, but he will be mindful at every step of also protecting the jobs of American workers. This will require putting conservative principles into action.

Significant Regulatory Reform

The first step will be a rational and streamlined approach to regulation, which would facilitate rapid progress in the development of our domestic reserves of oil and natural gas and allow for further investment in nuclear power.

• Establish fixed timetables for all resource development approvals
• Create one-stop shop to streamline permitting process for approval of common activities
• Implement fast-track procedures for companies with established safety records to conduct pre-approved activities in pre-approved areas
• Ensure that environmental laws properly account for cost in regulatory process
• Amend Clean Air Act to exclude carbon dioxide from its purview
• Expand NRC capabilities for approval of additional nuclear reactor designs
• Streamline NRC processes to ensure that licensing decisions for reactors on or adjacent to approved sites, using approved designs, are complete within two years

Increasing Production

The United States is blessed with a cornucopia of carbon-based energy resources. Developing them has been a pathway to prosperity for the nation in the past and offers similar promise for the future.

• Conduct comprehensive survey of America’s energy reserves
• Open America’s energy reserves for development
• Expand opportunities for U.S. resource developers to forge partnerships with neighboring countries
• Support construction of pipelines to bring Canadian oil to the United States
• Prevent overregulation of shale gas development and extraction

Research and Development

Government has a role to play in innovation in the energy industry. History shows that the United States has moved forward in astonishing ways thanks to national investment in basic research and advanced technology. However, we should not be in the business of steering investment toward particular politically favored approaches. That is a recipe for both time and money wasted on projects that do not bring us dividends. The failure of windmills and solar plants to become economically viable or make a significant contribution to our energy supply is a prime example.

• Concentrate alternative energy funding on basic research
• Utilize long-term, apolitical funding mechanisms like ARPA-E for basic research

Here are some collected energy-related quotes from the candidate:

“In place of real energy, Obama has focused on an imaginary world where government-subsidized windmills and solar panels could power the economy. This vision has failed."

“First, I will pursue dramatic regulatory reform to accelerate the exploration and development of oil and gas, to facilitate construction of vital infrastructure and to preserve and expand crucial electricity capacity. I will streamline permitting processes and create fixed timelines. Businesses can live with 'yes' or 'no,' but government must stop saying 'maybe' or 'wait.'"

“I will modernize our outdated environmental laws to take cost into account, and stop the EPA’s practice of using imaginary benefits to justify onerous burdens. In my administration, coal will not be a four-letter word. Instead, we will applaud the industry’s success in consistently expanding electricity output while reducing pollution. And I will respect states’ proven ability to regulate fracking, rather than sending federal bureaucrats to take control."

“Second, I will increase production. [...] I will permit access to our resources in the Gulf of Mexico, the Outer Continental Shelf, western lands and the Alaska National Wildlife Refuge. I also will partner closely with our neighbors. Canada and Mexico have extraordinary resources of their own that can provide secure, reliable supplies for our economy. This starts with my approval of the Keystone XL pipeline on Day One."

“Third, I will invest in new energy technologies. We must not allow President Obama’s irresponsible and unethical funding of companies such as Solyndra to undermine the Department of Energy’s critical mission of basic research. We can position America to lead on energy in the future without picking winners or stifling the energy sources of today.”
 

Romney does not support cap-and-trade or the Kyoto Treaty. Romney's viewpoint on global warming, according to a spokesperson: "He believes it’s occurring, and that human activity contributes to it, but he doesn’t know to what extent."

Go Green

But before Romney details his plan, he takes some swipes at the Obama administration's energy plan:

As the Obama administration wages war against oil and coal, it has been spending billions of dollars on alternative energy forms and touting its creation of “green” jobs. But it seems to be operating more on faith than on fact-based economic calculation. To begin with, wind and solar power, two of the most ballyhooed forms of alternative fuel, remain sharply uncompetitive on their own with conventional resources such as oil and natural gas in most applications. Indeed, at current prices, these technologies make little sense for the consuming public but great sense only for the companies reaping profits from taxpayer subsidies.

Romney accuses the Obama administration of having an "unhealthy obsession with green jobs" and cites studies which show that green jobs might actually hurt employment rather than help it. Obama's delay of the construction of the Keystone XL pipeline is also labeled a job killer; the document cites an arguable figure of 100,000 jobs lost in not constructing the pipeline that would originate at the Alberta Tar Sands.

Here is Romney's energy platform, excerpted from his website.

What’s at Stake

Producing more domestic energy would create good jobs and bolster local economies in a wide variety of energy-producing regions that effectively “export” their product to the rest of the country. While countless jobs are engaged in the actual energy-production process, they are a small fraction of the full workforce that benefits. For instance, before the first barrel of oil is pumped out of the ground, entire industries are hard at work creating the equipment and providing the services used in drilling, production, and the long chain of supporting industries that brings energy from inside the earth to the consumer.

The ripple effects into the non-energy sectors of the economy are commensurately important. If instead of sending hundreds of billions of dollars overseas we can send them to our own energy-rich centers, the nation as a whole will experience the economic benefits that we currently see other countries enjoying at our expense.

Obama’s Failure

Unfortunately, the first three years of the Obama administration have witnessed energy and environmental policies that have stifled the domestic energy sector. In thrall to the environmentalist lobby and its dogmas, the President and the regulatory bodies under his control have taken measures to limit energy exploration and restrict development in ways that sap economic performance, curtail growth, and kill jobs.

The Obama administration’s energy policy has been simply incoherent. For instance, it has blocked off-shore drilling in U.S. waters while applauding increased drilling off the coast of Brazil. Similarly, it has blocked construction of a pipeline that would bring Canadian oil to the United States, knowing full well that the result would be Canadian oil flowing to China instead. And it has pursued numerous regulations that would drive up energy prices while destroying millions of jobs.

As the Obama administration wages war against oil and coal, it has been spending billions of dollars on alternative energy forms and touting its creation of “green” jobs. But it seems to be operating more on faith than on fact-based economic calculation. The “green” technologies are typically far too expensive to compete in the marketplace, and studies have shown that for every “green” job created there are actually more jobs destroyed. Unsurprisingly, this costly government investment has failed to create an economic boom.

Mitt’s Plan

As president, Mitt Romney will make every effort to safeguard the environment, but he will be mindful at every step of also protecting the jobs of American workers. This will require putting conservative principles into action.

Significant Regulatory Reform

The first step will be a rational and streamlined approach to regulation, which would facilitate rapid progress in the development of our domestic reserves of oil and natural gas and allow for further investment in nuclear power.

• Establish fixed timetables for all resource development approvals
• Create one-stop shop to streamline permitting process for approval of common activities
• Implement fast-track procedures for companies with established safety records to conduct pre-approved activities in pre-approved areas
• Ensure that environmental laws properly account for cost in regulatory process
• Amend Clean Air Act to exclude carbon dioxide from its purview
• Expand NRC capabilities for approval of additional nuclear reactor designs
• Streamline NRC processes to ensure that licensing decisions for reactors on or adjacent to approved sites, using approved designs, are complete within two years

Increasing Production

The United States is blessed with a cornucopia of carbon-based energy resources. Developing them has been a pathway to prosperity for the nation in the past and offers similar promise for the future.

• Conduct comprehensive survey of America’s energy reserves
• Open America’s energy reserves for development
• Expand opportunities for U.S. resource developers to forge partnerships with neighboring countries
• Support construction of pipelines to bring Canadian oil to the United States
• Prevent overregulation of shale gas development and extraction

Research and Development

Government has a role to play in innovation in the energy industry. History shows that the United States has moved forward in astonishing ways thanks to national investment in basic research and advanced technology. However, we should not be in the business of steering investment toward particular politically favored approaches. That is a recipe for both time and money wasted on projects that do not bring us dividends. The failure of windmills and solar plants to become economically viable or make a significant contribution to our energy supply is a prime example.

• Concentrate alternative energy funding on basic research
• Utilize long-term, apolitical funding mechanisms like ARPA-E for basic research

Here are some collected energy-related quotes from the candidate:

“In place of real energy, Obama has focused on an imaginary world where government-subsidized windmills and solar panels could power the economy. This vision has failed."

“First, I will pursue dramatic regulatory reform to accelerate the exploration and development of oil and gas, to facilitate construction of vital infrastructure and to preserve and expand crucial electricity capacity. I will streamline permitting processes and create fixed timelines. Businesses can live with 'yes' or 'no,' but government must stop saying 'maybe' or 'wait.'"

“I will modernize our outdated environmental laws to take cost into account, and stop the EPA’s practice of using imaginary benefits to justify onerous burdens. In my administration, coal will not be a four-letter word. Instead, we will applaud the industry’s success in consistently expanding electricity output while reducing pollution. And I will respect states’ proven ability to regulate fracking, rather than sending federal bureaucrats to take control."

“Second, I will increase production. [...] I will permit access to our resources in the Gulf of Mexico, the Outer Continental Shelf, western lands and the Alaska National Wildlife Refuge. I also will partner closely with our neighbors. Canada and Mexico have extraordinary resources of their own that can provide secure, reliable supplies for our economy. This starts with my approval of the Keystone XL pipeline on Day One."

“Third, I will invest in new energy technologies. We must not allow President Obama’s irresponsible and unethical funding of companies such as Solyndra to undermine the Department of Energy’s critical mission of basic research. We can position America to lead on energy in the future without picking winners or stifling the energy sources of today.”
 

Romney does not support cap-and-trade or the Kyoto Treaty. Romney's viewpoint on global warming, according to a spokesperson: "He believes it’s occurring, and that human activity contributes to it, but he doesn’t know to what extent."

Go Green

All eyes are on HB 2789, now seeking final approval in the Arizona State Senate. It would submit the Arizona Corporation Commission's constitutionally rendered power to regulate utilities to legislative scrutiny. When people in Arizona’s solar industry talk about it, one word keeps coming up.

“HB 2789,” Southwest Policy Advisors Partner Todd Landfried said, would “create market uncertainty, regulatory uncertainty and legislative uncertainty.”

“There is uncertainty,” explained Ironco CEO Sheridan Bailey, whose construction company fell to 30 employees, transitioned to the solar industry in 2008 and now employs 350. “We are making investments for growth and we are moving forward,” he said, but “investors don’t like to make bets in uncertain territories and our legislature demonstrates those radical moves that are not good for jobs, not good for the economy, not good for energy security and not good for the state.”

“I don’t think anybody can predict what’s going to happen in the last few weeks of the legislature,” noted solar advocacy group VoteSolar’s Arizona spokesperson Susannah Churchill. Many will see HB 2789’s passage “as a signal the state doesn’t want more than a small part of its electricity to come from renewables and [firms] would probably look to other states more welcoming to renewable energy investment.”

Bailey added numbers to Churchill’s observation. “There is probably $ 250 million worth of work and 1,200 jobs over the next three years at stake,” he said, “because of the way it demonstrates an uncertainty and inconsistency in Arizona’s renewable energy policy.”

“Investors don’t like instability,” Landfried explained. “They don’t like putting tens or hundreds of millions or even billions of dollars where some act of government can create a threat to the market.”

After the legislature’s lower house passed HB 2789, Landfried said, plans were dropped for a solar power plant near Gila Bend, a town in the state’s far south that developers had been flocking to because of its intense sun, ample transmission and proximity to the Phoenix, Tucson, Los Angeles and San Diego markets. “The land was optioned. But the developer decided the Arizona market was too unstable and decided not to exercise the option.”

It could be an ominous sign that the ACC directed regulated utilities to lower their performance-based incentives (PBIs) to commercial developers and upfront incentives (UFIs) for residential solar. “Every year, the ACC approves an annual implementation plan for the RES for the big utilities, Churchill explained. “This past year they approved quite aggressively low incentive levels.”

APS, the state’s biggest utility,  had its starting UFI go from $ 3 per watt in 2010 to 75 cents per watt this year and had its PBI drop from 2010’s roughly sixteen-cent cap to this year’s approximately eight-cent cap, according to an SEIA authority on Arizona.

An Arizona political insider, noting that the 2012 APS solar budget of $ 25 million was down from over $ 40 million in 2011, suggested it could be associated with the  political shift in the five-member ACC, which went from a one-vote staunchly pro-renewables majority to a one-vote essentially anti-renewables majority in the 2010 election.

On the other hand, Churchill noted, “solar costs have really come down. PV module costs have come down something like three-quarters in just the last three years.” That means, she explained, that developers and installers “need fewer incentive dollars to make the projects make financial sense.”

But, she repeated, “the ACC’s approved incentive levels are quite aggressively low.” While “there is good reason to decline incentives as solar costs go down,” Churchill said, “we’ll need to see what happens this year with the number of megawatts installed in relation to these very low incentives. Maybe the industry can make it work. We’ll just have to see.”

Bailey said Ironco “is growing, notwithstanding the efforts of people to settle turf issues between the legislature and the corporation commission.”

It is not, he explained, about renewable energy. “I don’t think there are many in the legislature or the state hostile to solar itself,” he said. “We may have different attitudes about whether government should be involved in subsidies of any kind,” he said, and the conservative Goldwater Institute “has been pushing this agenda for years. They’re pushing it on the basis of an ideological principle.”

Bailey supports incentives for renewables. “A surcharge is not only a subsidy, it is also an investment strategy in long-term cost control by eliminating fuel costs as a component of the power generation cycle.”

The way to deal with the state legislature, he added, is to “keep your eye on what’s going on over there and respond when it gets crazy. Politicians respond to political realities.”

That is, perhaps, why Churchill remains hopeful. “A host of polls in the last year, done by the utilities and others, clearly show Arizonans of all political stripes really support a transition to renewable energy and believe it makes sense from an energy independence perspective and from a jobs perspective.” Lawmakers who back HB 2789, she said, “are out of step with the majority of Arizonans.”

Go Green

All eyes are on HB 2789, now seeking final approval in the Arizona State Senate. It would submit the Arizona Corporation Commission's constitutionally rendered power to regulate utilities to legislative scrutiny. When people in Arizona’s solar industry talk about it, one word keeps coming up.

“HB 2789,” Southwest Policy Advisors Partner Todd Landfried said, would “create market uncertainty, regulatory uncertainty and legislative uncertainty.”

“There is uncertainty,” explained Ironco CEO Sheridan Bailey, whose construction company fell to 30 employees, transitioned to the solar industry in 2008 and now employs 350. “We are making investments for growth and we are moving forward,” he said, but “investors don’t like to make bets in uncertain territories and our legislature demonstrates those radical moves that are not good for jobs, not good for the economy, not good for energy security and not good for the state.”

“I don’t think anybody can predict what’s going to happen in the last few weeks of the legislature,” noted solar advocacy group VoteSolar’s Arizona spokesperson Susannah Churchill. Many will see HB 2789’s passage “as a signal the state doesn’t want more than a small part of its electricity to come from renewables and [firms] would probably look to other states more welcoming to renewable energy investment.”

Bailey added numbers to Churchill’s observation. “There is probably $ 250 million worth of work and 1,200 jobs over the next three years at stake,” he said, “because of the way it demonstrates an uncertainty and inconsistency in Arizona’s renewable energy policy.”

“Investors don’t like instability,” Landfried explained. “They don’t like putting tens or hundreds of millions or even billions of dollars where some act of government can create a threat to the market.”

After the legislature’s lower house passed HB 2789, Landfried said, plans were dropped for a solar power plant near Gila Bend, a town in the state’s far south that developers had been flocking to because of its intense sun, ample transmission and proximity to the Phoenix, Tucson, Los Angeles and San Diego markets. “The land was optioned. But the developer decided the Arizona market was too unstable and decided not to exercise the option.”

It could be an ominous sign that the ACC directed regulated utilities to lower their performance-based incentives (PBIs) to commercial developers and upfront incentives (UFIs) for residential solar. “Every year, the ACC approves an annual implementation plan for the RES for the big utilities, Churchill explained. “This past year they approved quite aggressively low incentive levels.”

APS, the state’s biggest utility,  had its starting UFI go from $ 3 per watt in 2010 to 75 cents per watt this year and had its PBI drop from 2010’s roughly sixteen-cent cap to this year’s approximately eight-cent cap, according to an SEIA authority on Arizona.

An Arizona political insider, noting that the 2012 APS solar budget of $ 25 million was down from over $ 40 million in 2011, suggested it could be associated with the  political shift in the five-member ACC, which went from a one-vote Democratic majority to a one-vote Republican majority in the 2010 election.

On the other hand, Churchill noted, “solar costs have really come down. PV module costs have come down something like three-quarters in just the last three years.” That means, she explained, that developers and installers “need fewer incentive dollars to make the projects make financial sense.”

But, she repeated, “the ACC’s approved incentive levels are quite aggressively low.” While “there is good reason to decline incentives as solar costs go down,” Churchill said, “we’ll need to see what happens this year with the number of megawatts installed in relation to these very low incentives. Maybe the industry can make it work. We’ll just have to see.”

Bailey said Ironco “is growing, notwithstanding the efforts of people to settle turf issues between the legislature and the corporation commission.”

It is not, he explained, about renewable energy. “I don’t think there are many in the legislature or the state hostile to solar itself,” he said. “We may have different attitudes about whether government should be involved in subsidies of any kind,” he said, and the conservative Goldwater Institute “has been pushing this agenda for years. They’re pushing it on the basis of an ideological principle.”

Bailey supports incentives for renewables. “A surcharge is not only a subsidy, it is also an investment strategy in long-term cost control by eliminating fuel costs as a component of the power generation cycle.”

The way to deal with the state legislature, he added, is to “keep your eye on what’s going on over there and respond when it gets crazy. Politicians respond to political realities.”

That is, perhaps, why Churchill remains hopeful. “A host of polls in the last year, done by the utilities and others, clearly show Arizonans of all political stripes really support a transition to renewable energy and believe it makes sense from an energy independence perspective and from a jobs perspective.” Lawmakers who back HB 2789, she said, “are out of step with the majority of Arizonans.”

Go Green

The conference was concerned with greentech in developing markets but Khosla's speech spanned a wider swath than that.

Khosla noted that after the dot com crash internet traffic growth remained unchanged. The internet didn't collapse — the only thing that changed was stock prices, "which has nothing to do with the real world," according to Khosla, who concluded that, "cleantech is not what journalists value or what Wall Street values. The two are completely unrelated."

"Cleantech comes in and out of fashion," said Khosla and "will be OK if you can keep the environmentalists at bay." Khosla said, "Cleantech has been hurt more by environmentalists than any other constituency."

Khosla suggested that environmentalists "push all these idealized solutions — that don't make any economic sense, adding, "Don't look at theoretical scenarios — look at what makes economic sense. Nothing defies the law of economic gravity…I don't care how green it is if it does not work for the rest of the world." And, "Priuses sell well in Berkeley" but Khosla noted, that they did not sell well in Mississippi "and Mississippi is closer to the rest of the world than Berkeley."
 
Some more observations from Khosla on energy in developing nations:

• "Battery storage makes more sense in India" than in the U.S. It's much easier to compete with diesel power than to compete against a coal plant.
• LED lighting has a fast 6-month payback time in a retail setting in India.
• "Wind doesn't make sense unless you attach storage to it."  (editor's note: huh?)
• "We need to find a way to lower the cost of capital."
• Energy startups should focus on the Chindia price.
• There was lots of opportunity in developing economies "where you don't have enough grid."

 
The investor spoke of a few of his cleantech portfolio firms and their exposure to emerging markets.

According to Khosla, LanzaTech takes flue gases from steel mills' exhaust and converts the flue gas to butanol, ethanol, or propanol. The steel mills working with Lanza such as China's Heibei or Baosteel are in the emerging world. Khosla called it a "perfect project" in taking a waste stream and transforming it to something useful. He said that it "could turn more profit from the steel mill than the steel itself."

The company uses a proprietary microbe that consumes carbon monoxide and emits ethanol without using water or land resources, according to Prabhakar Nair, VP of business development in Asia for LanzaTech. The company recently raised $ 55.8 million in a Round C of financing, which will be used to scale up. LanzaTech currently has a pilot mill in New  Zealand, where the company is headquartered, and is opening a pre-commercial scale plant for Baosteel this year.
 
The goal at Kior is to replace every one of the hundreds of shutterred paper mill in this country with a Kior factory converting wood chips to fuel. This firm is starting its operations in Mississippi and selling its fuel directly to Fedex and Chevron.
Khosla claims that the firm will compete with unsubsidized $ 100-per-barrell oil.

Khosla's other portfolio firm, PSP (formerly Point Source Power) of Alameda, California looks to provide a low-cost solid oxide fuel cell powered by the heat of a cook stove and a charcoal or dung fuel. The electricity produced by the fuel cell could charge a cell battery or power an LED light. The first market is Kenya.

Asked "How can governments replicate Silicon Valley?" Vinod suggested that government "Stay out of our way." He added, I've not seen a single project done well by any NGO in the cleantech area," adding, "I'd guess that half of money goes to consultants. I'd consider most of that money wasted."

Khosla dismissed the McKinsey & Company consulting firm as producing "content-free buzzword-compliant reports" and the Hewlett and Rockefeller foundations as "highly wasteful organizations." He suggested that wanting to do good is not the same as doing good. Doing good is about being hard-nosed and making tough decisions.

Back to environmentalists: "The environmentalists have done a good job of flagging the key questions" but "when they start pushing solutions, environmentalists do poorly."

***

Articles by and about Vinod Khosla.

Khosla Slaps Energy Storage with Some Tough Love

Khosla On Biofuels

Khosla On Thin Film Solar

Go Green

Upon reflection, none of these technology-rich products pass the Chindia test. The "Chindia test" is a term coined by VC investor Vinod Khosla that suggests energy solutions must work in China and India if they are to have any material impact.

So how does an entrepreneur make a difference in emerging markets like China or India or in certain cases, the U.S.?

The Berkeley-Stanford Cleantech Conference on April 12 at the Stanford campus explores that question from a number of angles. Mr. Khosla will be offering his view in one of the keynotes.

Donn Tice, the CEO and Chairman of D.light Design, a cleantech entrepreurial success in the developing world, is also speaking at that event.

D.light builds a line of affordable, solar-powered lamps — including one with a mobile-phone charging feature — with the aim of replacing kerosene-powered lights, which are dirty and dangerous. The company's target is to improve the quality of life for 50 million people by 2015. The firm has funding from philanthropic investors like the Omidyar Network as well as traditional VCs like DFJ and Garage Technology Ventures. Building the solar lamp is one part of the enterprise; the other is creating a sales network to get the device into the hands of the people who need it.

According to Tice, the threshold question is "How important is technology?" and "What is impactful technology?"

As cleantech companies in developed economies navigate an uncertain policy and economic environment in their own countries, a huge opportunity is opening up for these firms to sell their products and develop projects in emerging markets.

Tice spoke of the previously mentioned technologist prejudice. "We have a bias that large-scale, capital-intensive, technology solutions are what works. In the developed world they do. In the non-developed world, they don't." He adds that "Cleantech is necessary but insufficient for success. It's great and important — once you have technology, you're in the game."

So getting technology into people's hands in emerging economies comes down to distribution and education. "Technology is enabling, but you actually have to get the product to these places. You have to educate, demonstrate and then maybe the people will adopt." He added, "If you think that last mile of cable [in the U.S.] is difficult, what do you do in Uthar Pradesh, India?"

Tice concluded, "It's not build it and they will come." It's "What is the appropriate technology for these consumers and these markets?"

More details on the April 12 event on Stanford University campus here.

Go Green

Upon reflection, none of these technology-rich products pass the Chindia test. The "Chindia test" is a term coined by VC investor Vinod Khosla that suggests energy solutions must work in China and India if they are to have any material impact.

So how does an entrepreneur make a difference in emerging markets like China or India or in certain cases, the U.S.?

The Berkeley-Stanford Cleantech Conference on April 12 at the Stanford campus explores that question from a number of angles. Mr. Khosla will be offering his view in one of the keynotes.

Donn Tice, the CEO and Chairman of D.light Design, a cleantech entrepreurial success in the developing world, is also speaking at that event.

D.light builds a line of affordable, solar-powered lamps — including one with a mobile-phone charging feature — with the aim of replacing kerosene-powered lights, which are dirty and dangerous. The company's target is to improve the quality of life for 50 million people by 2015. The firm has funding from philanthropic investors like the Omidyar Network as well as traditional VCs like DFJ and Garage Technology Ventures. Building the solar lamp is one part of the enterprise; the other is creating a sales network to get the device into the hands of the people who need it.

According to Tice, the threshold question is "How important is technology?" and "What is impactful technology?"

As cleantech companies in developed economies navigate an uncertain policy and economic environment in their own countries, a huge opportunity is opening up for these firms to sell their products and develop projects in emerging markets.

Tice spoke of the previously mentioned technologist prejudice. "We have a bias that large-scale, capital-intensive, technology solutions are what works. In the developed world they do. In the non-developed world, they don't." He adds that "Cleantech is necessary but insufficient for success. It's great and important — once you have technology, you're in the game."

So getting technology into people's hands in emerging economies comes down to distribution and education. "Technology is enabling, but you actually have to get the product to these places. You have to educate, demonstrate and then maybe the people will adopt." He added, "If you think that last mile of cable [in the U.S.] is difficult, what do you do in Uthar Pradesh, India?"

Tice concluded, "It's not build it and they will come." It's "What is the appropriate technology for these consumers and these markets?"

More details on the April 12 event on Stanford University campus here.

Go Green

Concentrated solar power (CSP) brings a value to the energy table that photovoltaic technology (PV) just doesn't have. That's the ability to store daytime heat energy from the sun for use when the sun is down. CSP can act as "partially dispatchable" power instead of the intermittent and daylight-only power which limits PV's value and strikes fear in the heart of Independent System Operators (ISOs), who tend to favor more consistent and dispatchable power sources. Amory Lovins of RMI suggests that "baseload" is an outdated term and the new grid will be able to handle all varieties of asynchronous power. But Lovins has yet to assume a role of keeping the lights on — which is the job of the ISO.

CSP uses the sun's energy, concentrated with mirrors, to heat a fluid and drive a turbine. There are "trough" and the more efficient "power tower" architectures.

Like Symyx, Intermolecular, or Wildcat Discovery, Halotechnics is in the business of high-throughput chemical and materials discovery. Halotechnics is specifically targeting new high-temperature storage materials in the molten salt and molten glass family for CSP storage applications. 

The eight-employee startup has screened 20,000 unique materials in molten salt and molten glass and has filed seven patents. The firm is able to run 100 experiments every day in the search for an energy storage medium with optimum characteristics.

"There's a bottleneck in CSP," according to Raade, "and that's the efficiency of molten salt heat transfer."

The higher the temperature of the storage medium, the less material needs to be used and the lower the capex of the installation. And CSP needs every penny in savings in order to compete against PV. The chart below from GTM Research clearly shows the impact of storage on the levelized cost of energy (LCOE) of CSP.

Today, molten salt storage is widely used in solar thermal plants in Spain. The “solar salts” are composed of 60 percent sodium nitrate (NaNO3) and 40 percent potassium nitrate (KNO3) — both commonly available materials. Currently, molten salt is used at about 565 degrees C, but Halotechnics is looking at higher temperature salts at 700 degrees C and molten glass at even higher temperatures. The company's business plan is now a licensing model, but the firm could pivot into becoming a supplier of the materials themselves or of the complete storage systems.

Halotechnics claims that molten glass at a temperature of 1,200 degrees C has the potential to reduce capex costs by a factor of ten when deployed at commercial scale. Raade sees molten glass as "exciting" because "it is dirt cheap." He adds that "everything is cheaper at high temperatures," noting that molten glass is handled by glass manufacturers all the time so the technology is already equipped to handle these temperature extremes.

CSP players and projects include the Gemasolar plant built by Torresol, which has demonstrated 24-hour power in a 19.9-megawatt system, as well as Solar Millennium's Andasol project, Abengoa, SolarReserve, and the soon-to-be-public BrightSource Energy. SolarReserve has completed construction on the world's tallest solar power tower, a 540-foot structure in Tonopah, Nevada at the Crescent Dunes Solar Energy Power Plant.

Almost 30,000 tons of molten salt are used in the Andasol plant in Spain, according to Raade. Halotechnics' next step is a 300-kilogram demonstration system followed by a pilot test with ten tons of material and "more realistic pumps and volumes."
 
NREL's Paul Denholm and Mark Mehos, in a November 2011 study (PDF) called "Enabling Greater Penetration of Solar Power via the Use of CSP with Thermal Energy Storage," say this about thermal energy storage (TES):

The use of thermal energy storage in concentrating solar power plants provides one option for increased grid flexibility in two primary ways. First, TES allows shifting of the solar resource to periods of reduced solar output with relatively high efficiency. Second is the inherent flexibility of CSP/TES plants, which offer higher ramp rates and ranges than large thermal plants currently used to meet a large fraction of electric demand. Given the high capacity value of CSP/TES, this technology could potentially replace a fraction of the conventional generator fleet and provide a more flexible generation mix. This could result in greater use of non-dispatchable solar PV and wind meaning CSP and PV may actually be complementary technologies, especially at higher penetrations.

Keely Wachs of BrightSource Energy notes, "The thermal storage sector is really starting to innovate and support higher-temperature steam operations, which translates to even greater cost advantages over other electrical storage technologies."

Halotechnics is armed with almost $ 6 million in grants from ARPA-E, NREL, the NSF, and the DOE.

Levelized Cost of Energy of Various Generating Technologies (from GTM Research)

Global CSP Ecosystem (from GTM Research)

Go Green