Renewable Energy and Carbon Credits

Heath NorrickManager of Renewable Energy

Hoosier Energy REC, Inc.

Presentation Outline

• Hoosier Corporate Profile• Carbon Credits Vs. Renewable Energy Credits

(RECs)• Uses and Markets for Credits• Hoosier Efforts• Conclusions

Hoosier Energy REC, Inc.

• Generation and transmission cooperative (G&T)

• Approximately $1 billion in assets

• Own & operate power plants & transmission assets• 2 coal plants (Merom @ 1,000 MW and Ratts @ 250 MW)• 2 gas plants (Lawrence @260 MW and Worthington @ 175 MW)

• Own & maintain over 1,300 miles of transmission lines and 250 delivery points

• Over 10 million megawatt-hours (MWh) sales in 2006• Assisted with over $7B in new investment in central and southern Indiana

in the last 15 years

Carbon Credits Vs. RECs

Carbon Credits• Electricity generation is not

necessary for production: Tons of CO2 reduced, avoided, or sequestered

• Carbon Credits are defined by international protocols or voluntary markets

• Cannot “double dip” with Carbon Credits and RECs from same source

Renewable Energy Credits• Only relates to the

generation of electricity 1 MWh=1 REC

• RECs are defined at the state level currently for RPS purposes

• Debate over what types of generation produce RECs

Uses and Markets

Carbon Credits• Meet emissions limits in cap

and trade systems

• Involves multiple industrial sectors

• Allow companies/individuals to offset carbon footprint voluntarily

• EU ETS, Chicago Climate Exchange,

Renewable Energy Credits• Meet Renewable Portfolio

Standards at state level

• Involves the electrical generation industry

• Allow companies/individuals to use green energy voluntarily

• 29 States now have RPS

Landfill Gas Generation

• Clark Floyd Landfill Generating Station– Add a third Engine by June 2009– Increase total output to 3.6 MW

Biomass

• Carbon neutral, baseload, generation

• Potential around 15-30 MW

• Utilizes local waste streams

• Possible fuel mixing benefits at current coal facilities

Coalbed Methane

• Current Project– Data

Gathering/Modeling– Core Sampling

• Purpose– Quantity and Quality of

Gas estimation

Story County Wind Farm

• 150 MW Total = 100 GE SLE 1.5MW Turbines

• Hoosier has 25 MW

• Developed by Florida Power & Light

• COD November 15, 2008

Small Scale Wind & SolarIn Operation:

• Merom Education Center—15kW Wind, 3kW Solar• Victory Primary—1.8kW Wind, 3kW Solar• Decatur Switch Station—3kW Solar

In Progress or Scheduled for Completion by 2009:• Worthington Primary—3-6kW Solar• Franklin Training Center—3kW Solar

Member Cooperative Wind & Solar Program•Hoosier will provide

• a set financial contribution and project development guidance to REMCs wishing to install Wind or Solar Systems

•REMC owned installations will have high community visibility for member education

Conclusions

• RECs provide a vehicle for lowering carbon emissions in one sector of the economy

• RECs monetize and track current carbon reduction while waiting for federal regulation

• Carbon Credits and RECs share common purpose