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Resources for Action

Rob PrattDirector, MassachusettsRenewable Energy Trust

Presented to Berkshire Renewable Energy Leadership Summit

June 7, 2005 ~ Lenox, Massachusetts

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Renewable Energy Trust

• Funded by a system benefits charge as part of 1998 electricity restructuring ($25 million/year)

• Mission: Increase the supply of and demand for clean energy Promote the development of a vibrant Massachusetts

renewable energy industry Maximize benefit to Massachusetts ratepayers

• Managed by the Massachusetts Technology Collaborative, the state’s development agency for renewable energy and the innovation economy.

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Renewable Sources

• Wind

• Biomass

• Solar

• Hydroelectric

• Fuel cells

• Ocean Wave/Tidal

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Renewable Energy Cost Trends

Wind

1980 1990 2000 2010 2020

PVC

OE

ce

nts

/kW

h

1980 1990 2000 2010 2020

40

30

20

10

0

100

80

60

40

20

0

BiomassGeothermal

1980 1990 2000 2010 2020 1980 1990 2000 2010 2020

CO

E c

en

ts/k

Wh

10

8

6

4

2

0

15

12

9

6

3

0

Source: U.S. National Renewable Energy Laboratories

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Renewable Energy Capacity Trends

Projection of U.S. Renewables

0

10,000

20,000

30,000

40,000

50,000

2001 2010 2020R

en

ew

ab

le E

ne

rgy

Ca

pa

cit

y (

MW

)

Geothermal Wind Solar/PV Biomass

Projection of Worldwide Renewables

0

20,000

40,000

60,000

80,000

100,000

120,000

2001 2010

Re

ne

wa

ble

En

erg

y C

ap

ac

ity

(M

W)

Geothermal Wind Solar/PV

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Fossil Fuel Prices:Crude Oil

Oil prices:$57+/barrel and

heading up?

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Fossil Fuel Prices:Natural Gas

12-mo. NG prices:

Over $7.7/MMBtu

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Reasons for Optimism• Cost of renewable technology continues to

decrease while fossil fuel prices increase

• Renewables demand continues to increase 19 states have RPS requirements 15 states have funds dedicated to renewables Voluntary markets are starting to form

(particularly for C&I customers)

• Utilities, oil companies and major energy companies are becoming major players in renewable energy market

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Renewable Energy Trust Programs

• Clean Energy Supporting large-scale clean energy development in the state Educating Massachusetts citizens, teachers, and students

about the benefits of clean energy

• Green Buildings and Infrastructure Developing green building projects powered by clean energy

• Industry Support Accelerating job growth, economic development, and

technological innovation in the state

• Policy Unit Collaborating with interested stakeholders to address market

and regulatory barriers to new clean energy development

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Massachusetts Renewable

Portfolio Standard (RPS)• Facility Eligibility

Wind, solar PV, landfill gas, biomass, ocean

• Applies to utilities and competitive suppliers

• Ways to Comply: Renewable Energy

Certificates (RECs) Alternative

Compliance Payment ($50/MWh)

-

500

1,000

1,500

2,000

2,500

2003 2004 2005 2006 2007 2008 2009M

A R

enew

able

Ene

rgy

Dem

and

(MW

h)

1.0%1.5%

2.0%2.5%

3.0%3.5%

4.0%

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New England Renewable Energy

Certificates• New England Generation Information System (NE-

GIS) System to track attributes of power generated in New

England

• Goal: separate attributes from energy Encourage flexible trading across region

• RECs are from eligible renewables in any NE state• Six month shift between production and REC

creation:

e e

Jan 05 Mar 05

Energy (MWh) Generated in Q1

Time shift toREC creation

Q1 2005 RECs created/traded in Q3

Jul 05 Sep 05

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Large-Scale Renewable Energy Support

• Massachusetts Green Power Partnership (MGPP) Goal: Provide REC revenue certainty to developers

through long-term contracts (up to 10 years). Trust manages market risks regarding future REC

value and demand

• Predevelopment Financing Goal: Provide early-stage support for large renewable

energy projects serving Massachusetts Grants available to public entities Financing available to all eligible applicants

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Community Wind Initiative

• Goal: Help MA cities and towns tap into the power of the wind to: meet local electricity needs and be a potential source of revenue.

• Communities can participate by:1.Developing and hosting local, community-scale

wind turbines. Trust assistance includes:• wind monitoring equipment and data analysis,• technical assistance, and • access to competitively secured resources (e.g. wind

turbines)

2. Communities that do not have adequate wind can:

• participate as part of a regional development or • by purchasing clean electricity from a nearby wind turbine

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• $8.9 million budgeted over 5 years

• Over 10 kW projects; no upper size limit

• Up to $650,000 per project available

• All renewable technologies can apply

• Next round applications due in September

• Investor owned electric utility areas only

• Extra $ for public buildings, economic target areas, low income housing, etc.

• Must participate in efficiency programs

Large Renewables Initiative

formerly known as “Commercial, Industrial & Institutional”

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$5 million available over 3 – 5

years

1. 10 kW or smaller projects are eligible

2. Rebates for PV, wind, or micro-hydro

3. Open or “rolling” application process• Apply anytime; applications processed

monthly

4. Applications available on MTC

website• Applications must be pre-approved!

Small Renewables Initiative

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Ratepayers can choose to pay a premium on their monthly electric bill to support renewables.

MTC matches each dollar of household or small business support with:

• Up to $1 to the consumer's community for renewable energy educational materials or projects.

NOTE: These funds may be combined with the Small Renewables Initiative rebates to cover up to 100% of project costs on a municipally-owned facility!

• Up to $1 additional to low-income energy projects

$2.5 million in matching funding available annually

To learn more visit: www.cleanenergychoice.org

Massachusetts Clean Energy Choice

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Hedge Program

Supports pursuit of long-term, price certain power for Massachusetts end-users:

1. Long-term contracts with renewable energy generators provide a hedge against fossil fuel price volatility

2. Supports financing of renewable generation facilities

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Green Buildings• 1/3 of U.S. energy consumption is used for

heating, cooling, lighting and appliances in buildings.

• Green Buildings Encourage the combination of high-performance

design, energy efficiency and renewable energy Reduce the energy consumption of this sector Enhance the sustainability of the built environment

• Trust commitment to Green Buildings: Financial and technical support to include

renewable energy technologies in Green Buildings Encouraging designs and solutions that are

replicable Documenting and disseminating lessons learned

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Green Schools Initiative• Partnership between MTC and

MA Dept. of Education• Promotes high performance

green design in new schools and major renovations

• Goal is a new set of standards for school construction in MA

• MTC provided funding for: 16 pilot schools (each received

up to $130k for design and up to $500k for construction)

38 schools received feasibility study grants @ $20k each

• Dept. of Ed. adds 2% to total state construction grant for eligible projects

Skylight - Capuano School in Somerville. Photo by HMFH Architects, Inc.

Schematic – new Dedham Middle SchoolDrawing by Dore and Whittier, Inc.

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• $10.6 million budgeted over 5 years

• Partnerships w/ MassHousing and others

• Coordinate with Energy Star Homes

• All renewable technologies can apply

• Investor owned electric utility areas only

• Must participate in efficiency programs

• Leveraging other funds for “green” elements of the projects

Affordable Green Housing Initiative

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Industry Support Program

Goal: accelerate job growth and economic development in the MA Renewable Energy industry cluster

1. Massachusetts Green Energy Fund (MGEF)• a privately managed venture capital fund

2. Sustainable Energy Economic Development (SEED) Initiative• Invest with companies that have yet to demonstrate

commercial viability of their tech.

3. Emerging Technology Solicitation• Grants to demonstrate emerging renewable energy

technologies at the commercial scale

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Investing in Massachusetts’

Clean Energy EconomyWin-win• Leverage MA strengths: technology, offshore resources,

human capital• Massachusetts Clean Energy Cluster

Approx. 10,000 jobs today One of top states in U.S. on per capita basis Experienced double digit growth last year Accelerates technology innovation and adaptation

• MRET can be a lead and patient investor where technology-intensive product development bears high costs

. . . And beyond Massachusetts• A geographic focus can nevertheless have a global

perspective (e.g., PV Export, MGEF)• Funding many technologies will prove more robust than a

single “bet”

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. . . and investors are interested

0

20

40

60

80

100

20000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Comparison of Renewable Energy Capitalization Forecasts

WorldWatch Clean Edge EBTC Navigant Average

Compiled by UMass EBTC 2004

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Trust Accomplishments

As of December 2004:• More than $119 million invested in more

than 350 projects serving Massachusetts

• Supporting approximately 226.52 MW of new renewables

• Planning and siting support for 7 projects expected to result in additional 630 MW

• 47 green buildings funded

• 93 green building feasibility studies funded

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For more information:www.masstech.org