Renewable Energy Vermont

Vermont Perspectives, Activities, and Plans

September 21, 2005J. Riley Allen

Vermont Department of Public Service

2

Topics Current Electricity Situation (National,

Regional, State) Renewable Energy in Vermont – Influences

from Beyond Implementation of Act 61 Vermont Clean Energy Fund

3

US Electricity Source Mix 1999 and 2003

C oal

51%

P etr ol eum

3%

Natur al G as

17%

Other G as es

0%

Nuc l ear

20%

Hydr oel ec tr i c

7%

Other

0%

Other R enewabl es

2%

C oal

52%

P etr ol eum

3%

Natur al G as

15%

Other G as es

0%

Nuc l ear

20%

Hydr oel ec tr i c

8%

Other R enewabl es

2%

Other

0%

1999 2003

Source: DOE EIA

4

Regional Electric Mix 1990, 1999, and 2003

C oal

15%

P etr ol eum

10%

Natur al Gas

35%

Other Gas es

0%

Nuc l ear

27%

Hydr oel ec tr i c

6%

Other R enewabl es

7%

Other

0%Coal

15%

Petroleum

24%

Natural Gas

19%

Other Gases

0%

Nuclear

26%

Hydroelectric Conventional

7%

Other Renewables

9%

Other

0%

1999 2003

C oal

17%

P etr ol eum

27%

Natur al G as

8%Other G as es

0%

Nuc l ear

33%

Hydr oel ec tr i c

8%

Other R enewabl es

7%

Other

0%

1990

Source Data: DOE EIA

5

Vermont Electricity Mix 2003

V er mon t I n st at e M ix ( in s ide bor der s)

Nuclear

74%

Hydr oelectr ic

19%

Coal

0%

P etr oleum

0%Other Renewables

7% Natur al Gas

0%

Instate Source Mix Committed Resource Source Mix

Oil

1%

Gas

1%

Nuclear

36%

Hydro

9%Renewable

6%

HQ

28%

System

19%

Source: DOE EIA Source: DPS

6

Vermont Monthly Avg Wholesale Price (March-03 to Aug-05)

$302

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

160.00

180.00

200.00

Mar -03 Apr -03 May-03 J un-03 J ul -03 Aug-03 Sep-03 Oct-03 Nov-03 Dec-03 J an-04 Feb-04 Mar -04 Apr -04 May-04 J un-04 J ul -04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 J an-05 Feb-05 Mar -05 Apr -05 May-05 J un-05 J ul -05 Aug-05

M onths

Monthly Average Average Peak Average

$55

Source: ISO-NE

7

Electricity Cost/Price Projections

Electricity Cost and Price Projectsions Wholesale to Vermont (DPS Preliminary Estimates Sept. 2005)

0.000

0.020

0.040

0.060

0.080

0.100

0.120

0.140

0.160

0.180

Energy Energy plus Capacity Energy Real $2005 Energy Plus Capacity $2005Source: DPS

8

Future Contract Prices in New England Average Contract Price for Energy January

and February are approximately $150/MWh

REC prices in Massachusetts for ’06 are about $40/MWh

9

National Legislation Energy Policy Act of 2005 (Signed August 8,

2005) Conditionally rescinds PURPA

(conditioned on access to markets and/or appropriate interconnection)

National assessment of renewables inventory potential Minimum requirements for Federal Government

Purchases Tax Incentives for New Renewables State regulators shall conduct certain investigations

(smart metering, interconnection, utility fuel diversification)

Encourages development of additional generation at existing dams

10

Regional Activity ISO-NE market for installed capacity Interconnection Standards (ISO-NE, Draft 12/05) Regional Greenhouse Gas Initiative (Stakeholder

meeting 9/21/05 – Target 2009 Initially a 9 state initiative)

Neighboring State Renewable Portfolio Standards (ME, MA, RI, CT)

Regional Clean Energy Funds (esp. MA and CT)

11

Vermont Renewables Law Act 61 (key provisions)

SPEED (Section 8005 encourages Vermont utilities to engage in long term contracts with instate renewable developers)

Renewable Portfolio Standard (establishes a renewable portfolio standard if targets for SPEED contracts are not met)

Interconnection Standards for Renewable Generation

Tradable Credits for Renewables Disclosure Standards for Renewable

Technologies

12

Other Vermont Renewable and Related Activities Vt. Clean Energy Development Fund (funding

approx. 2007 through 2012) Transmission Planning Investigation (Docket

7081) Green Pricing (GMP and CVPS’s “Cow Power”) Small Wind and Solar Incentive Fund ($800,000) Net Metering (approx. 830 kW) Mediated Modeling (Stakeholder discussion

focused on electricity policy in Vermont)

13

Small Wind and Solar Incentive Fund $800,000 in funding for small wind and solar

projects. Incentives are expected to support the installation of approximately 250 renewable energy systems in the state, which will generate an estimated 540 MWh of electricity

Originally established pursuant to Vermont Renewable Energy Legislation in 2003 with funding for $840,000 (approximately 200 projects)

14

VT Net Metering as of Sept ‘05  TOTAL   Wind Solar PV Methane Fuel Cell

TOTAL kW APPROVED

834kW AC 422 346.5 65 0

NUMBER SYSTEMS

184 Systems 49 134 1 0

AVERAGE SIZE   kW AC 8.6 2.6 65  

15

Act 61 ImplementationEarly Priorities SPEED Program (proposed rule 9/1/06) Interconnection Standards (proposed rule 9/1/06) Disclosure (no timeframe but needs to be

addressed in context of SPEED issues)Other Activities RPS (if SPEED threshold is not met 2013) Tradable Credits (RECs)

16

Vermont Clean Energy Development Fund Established pursuant to Act 74 (2005) Annual Funding levels likely to exceed $4

million per year through 2012

17

Vermont Clean Energy Development FundProcess DPS Draft and Public Comment Fall 2005 DPS Report to Legislature Due Jan. 2006 Major Funds likely to Begin March 2007?Funding Levels Estimated at >$4 million per year through March

2012

18

Vermont Clean Energy Development FundPreliminary Goals and Objectives Sustainability of fund Efficient use of funds/market discipline Leverage other programs and incentives (federal, other

state, and Vermont) Equitable distribution of funds throughout VT Benefits flowing to Vermont ratepayers Focus on technologies closer to market and/or feasibility

potential high in Vermont Programs and studies directed at reducing

barriers/developing the sector

19

Vermont Clean Energy Development FundLikely Approaches Revolving loans/equity investment; Grants/production credits for subsidy buy-down; Infrastructure developmentAdministration Independent third party? DPS Partnerships with other state agencies?

20

Vermont Clean Energy Development FundTechnologies and Use of

funds? Fuel Cell Photovoltaics Solar/Hot Water Landfill Methane Farm Methane Energy Efficiency

Technologies? (cont’d) Biomass

enhancements Wind Hydro enhancements CHP Biodiesel

21

Infrastructure Development Application of Funds Potentials and barriers analyses; Site pre-permitting and mitigation (aesthetic,

environmental, historic, sound); Strategies for enabling infrastructure and support

markets; Information, public awareness, and public

participation; Technical assistance; Demonstration.

22

Vermont Clean Energy Development Fund Other State Funds in New England/NY

Massachusetts ($20 M) Connecticut ($30 M) New York Rhode Island

23

Opportunities for Public Participation and Information Act 61 Implementation (PSB sponsored workshops)

www.state.vt.us/psb Mediated Modeling (DPS sponsored initiative)

www.publicservice.vermont.gov Vermont Clean Energy Fund (DPS study)

www.publicservice.vermont.gov Transmission Planning Investigation (PSB)

www.state.vt.us/psb Regional Greenhouse Gas Initiative

www.rggi.org

24

Conclusion