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News
- The following information was provided by the Arizona
Coalition for New Energy Technologies and edited for the
purposes of brevity
1. The
Arizona Coalition for New Energy Technologies, launched in
January, is comprised of21 Arizona businesses and non-profit
organizations from throughout the state. Members support
"environmentally responsible economic growth through the
efficient use of Arizona's abundant and clean sources of
energy," and will promote awareness of member
technologies to policymakers, business leaders, the academic
community, the media and other opinion leaders throughout
Arizona, demonstrating the many benefits these technologies
bring to the economy, the environment and to the energy
security of the state and the nation.
The Az. Coalition will provide briefings for state legislators
during legislative sessions, and information will go out to
Arizona stakeholders and communication elements to publicize
activities and advancement of members goals, showing that new
energy technologies are not just good for the environment, air
quality and mitigation of carbon dioxide and other greenhouse
gases, but also provide increasingly important economic
benefits to the state through the work of a growing business
community. The Az. Coalition is incorporated as a 501(c)(3)
non-profit and receives funding from the Energy Foundation.
2. Az. Legislature forms Renewables &
Energy Efficiency Caucus
The Arizona Legislature's Renewables and Energy Efficiency
Caucus was launched on 16 January 2002 by State Senators Scott
Bundgaard (R-Glendale) and Harry Mitchell (D-Tempe), along
with Representatives Randy Graf (R-Green Valley) and Debra
Norris (D-Sells). The intent of the Caucus is to inform
legislative members about new developments in renewable and
efficient energy technologies. through briefings and
site visits in the future.
This new legislative caucus is based on similar caucuses that
have enjoyed success in the U.S. House and Senate, as well as
in the Colorado legislature. The U.S. House Renewables
and Energy Efficiency Caucus, which was chaired by former Rep.
Matt Salmon (R-Arizona) during his tenure in Congress,
currently has 203 members representing 42 states. These
caucuses have proven to be an excellent way of providing
up-to-date, accurate and relevant information to state and
federal legislators. Current members of the Arizona Renewables
and Energy Efficiency Caucus are:
Senators Scott Bundgaard (R-Glendale), Ed Cirillo (R-Sun City
West) and Harry Mitchell (D-Tempe)
Representatives Mark Anderson (R-Mesa), Meg Burton Cahill
(D-Tempe), Ted Carpenter (R-Phoenix), Eddie Farnsworth
(R-Gilbert), Randy Graf (R-Green Valley), Karen Johnson
(R-Mesa), Laura Knaperek (R-Tempe), Debra Norris (D-Sells),
Tom O'Halleran (R-Sedona), Russell Pearce (R-Mesa), Gary
Pierce (R-Mesa), Ed Poelstra (R-Tucson)
3. Az. Coalition for New Energy Technologies
briefing to Az. Legislature's Renewables & Energy Caucus
A February briefing by member companies of the Az. Coalition
for New Energy Technologies to the Arizona Legislature's
Renewables and Energy Efficiency Caucus at the state capital
was attended by 12 legislators and other interested parties
from the business and environmental communities.
Presentations were made by Doran Dalton of NativeSUN in
Kykotsmovi (Hopi) on how solar energy technologies are helping
provide valuable environmental, economic and cultural benefits
to Native American communities in Arizona and throughout the
region; Andy Kruse of Southwest Windpower (Flagstaff), on
small scale wind technologies and how the Az. company's
products are creating a rapidly growing national and worldwide
export market; and Maruja Vargas, on behalf of ETA
Engineering (Tempe), on the important environmental and
societal benefits of all new energy technologies.
4. Legislation Advances Renewable Energy in
Arizona
The Arizona Clean Power Development Act (HB 2963) was
introduced in the Arizona House of Representatives on 28
February. Spearheaded by Representative Randy Graf
(R-Green Valley), the bill is cosponsored by Reps.Cheryl Chase
(D-Kearny), Jake Flake (R-Snowflake), Bobby Lugo (D-Bisbee),
Debra Norris (D-Sells), Russell Pearce (R-Mesa), Gary Pierce
(R-Mesa), Robert Robson (R-Chandler), and Senator Scott
Bundgaard (R-Glendale). The bill contains a number of
provisions that are designed to integrate solar, distributed
energy and energy efficiency into Arizona energy policy,
promote market development by eliminating barriers, and
strengthen the Arizona's Energy Office effectiveness in policy
and programs regarding clean energy technology use in Arizona.
Bud Annan, Clean Energy advocate, identifies that the Clean
Power Development Act has "four linking elements to start
Arizona down the road to an energy system that provides
reliable and affordable electric service for all while
minimizing its impacts on communities and the environment.....
Arizona's rate of growth in energy consumption outpaced our
rate in population growth last year. This trend when combined
with our growing dependence on fossil fuels will worsen our
air quality and leave us ill prepared for price increases,
supply interruptions and shortages. Despite the growing demand
for electricity, Arizona still has thousands of remote homes
on Native American lands without power."
Annan identifies that the 4 elements of the Act address and
promote the furthering of distributed, renewable energy in
Az. The first element promotes energy efficiency in
state/public buildings and provides incentives and technical
informational resources to achieve this efficiency.
The second alters Arizona's electricity planning structure to
include information development that offers alternatives to
large-scale generation and transmission, and requires
utilities planning construction of new transmission lines to
provide more technical and budgetary studies related to their
impact, and must include alternatives to new transmission
facilities. This section authorizes the Arizona
Corporation Commission to develop an energy infrastructure
incorporating distributed energy systems that allow energy to
be developed on-site, close to the energy demand.
The third element of the Act establishes a requirement that by
year 2007 Salt River Project derive 1.1% of the electricity it
sells from renewable energy and that 50% of this amount be
derived from solar energy. The bill authorizes a small
environmental surcharge - 35 cents a month per household
served by the utility - to help defray the compliance costs
and authorizes the use of tradable credits as a mechanism for
compliance.
The fourth element builds a foundation for a statewide
comprehensive energy policy and consumer education effort.
The bill establishes a mechanism to review the operations of
the state energy office; requires a consumer energy efficiency
and clean energy education effort; and forms a renewable
resource study committee. For a copy of Bud Annan's fact
sheet on HB 2963, contact him at annan@primenet.com.
5. Sales Tax Exemption for Solar Energy
Devices
The Arizona Legislature is also considering HB 2457 and SB
1336, which deal with Arizona's sales tax exemption for solar
energy devices. This bill would provide for a full sales
tax, or transaction privilege tax, exemption for solar
contractors, and provide retroactive relief for Arizona
contractors who have misunderstood Arizona's contractors'
sales tax exemption and failed to properly charge sales tax on
sales.
In the current statute, sales tax exemptions for solar are
identified in two locations, establishing separate exemptions
for contractors and for retail sellers of solar energy
devices. Contractors are allowed an exemption on their
wholesale cost of the system, while retailer sellers are
allowed an exemption on the full sales price of the system.
This caused a great deal of confusion regarding the exemption applicability
and even the Arizona Department of Revenue often provided
conflicting information to solar industry members.
The new, corrective legislation has passed various committees
of jurisdiction in both the House and the Senate, and
following a technical correction in the Senate, is expected to
pass both chambers of the Legislature and be forwarded to the
Governor for signature into law.
Michael Neary, Executive Director of the Arizona Solar Energy
Industries Association states "Passage of this bill as
amended would achieve the solar industry's goal of providing
retroactive relief to contractors who had mistakenly been
providing consumers with a full tax exemption, but contractors
will lose the exemption at the end of next year. The solar
sales tax exemption will continue to exist for retailers of
solar energy devices sales."
6. Debate Begins on Comprehensive U.S.
Senate Energy Bill
The United States Senate began debate on S. 517, the energy
policy bill, representing its first major attempt to overhaul
U.S. energy policy since 1992. Observers note that sharp
differences over issues such as drilling in the Arctic
National Wildlife Refuge and vehicle fuel-economy standards
will make it difficult to get this legislation passed.
The Senate energy bill includes a Renewable Portfolio Standard
(RPS) of ten percent. This policy mechanism would ensure
that 10% of the nation's electricity is generated from clean
energy such as wind, solar, geothermal and biomass, in an
affordable, market-driven manner. While a final vote on
the legislation could take weeks/months, votes on amendments
affecting the Renewable Portfolio Standard are expected to
take place soon.
Arizona Senator John McCain (R) has not yet taken a public
position on the RPS, while Senator John Kyl (R) is reportedly
planning to offer an amendment that would replace the RPS with
a provision requiring state "to consider offering
consumers access to green power."
Separately, the AP has reported that Senators McCain and John
Kerry (D-Mass.) have reached a compromise proposal to increase
automobile fuel economy to 36 miles per gallon by 2015.
According to the wire service, the compromise measure would
allow automakers to satisfy up to 10 percent of the
requirement by trading emission credits with other companies
that produce greenhouse gases, from power plants to factories
to dry cleaners. Current Corporate Average Fuel Economy
(CAFE) standards are 27.5 miles per gallon (mpg) for cars and
20.7 mpg for light trucks, which includes minivans, pickups
and sport utility vehicles.
For more information on S. 517, visit the Senate Energy
Committee's website at http://energy.senate.gov/.
For more information on the Renewable Portfolio Standard, the
Union of Concerned Scientists has informative materials
available at http://www.ucsusa.org/energy/renewhere.html.
7. Two-year Wind PTC Extension Passed by House
& Senate; President Sst to Sign Bill Into Law
The American Wind Energy Association reports that "[b]reaking
months of partisan gridlock, both the House and Senate have
approved a slimmed-down economic stimulus and unemployment
insurance bill (H.R. 3090) containing a two-year extension of
the wind energy Production Tax Credit (PTC). President
Bush has stated he will sign the bill into law.
Key provisions of the $51billion package include a 13-week
extension of unemployment benefits, economic assistance for
New York City, and a number of temporary corporate tax
cuts.The PTC, which had expired December 31, 2001, will be
extended retroactively from that date to December 31,
2003."
8. President's Budget Maintains Support for
Efficiency, Renewable Energy
Programs
President Bush released his administration's proposed $2.13
trillion federal budget for fiscal year (FY) 2003 on 4
February. Although the budget emphasis is on the war on
terrorism and U.S. homeland security, the budget maintains
funding for energy efficiency and renewable energy programs,
while providing new tax incentives to encourage the use of
these technologies.
The proposed overall budget for DOE's Office of Energy
Efficiency and Renewable Energy (EERE) remains nearly steady,
increasing about 0.8 percent above FY 2002 funding levels.
Funding for renewable energy programs increases 5.5 percent in
the budget, with significant funding boosts for hydrogen,
hydropower, and solar building technology research and
development, as well as for programs that encourage renewable
energy use on Indian reservations and internationally.
However, the research budget for
concentrating solar power technologies suffers a cut of 86
percent.
Overall funding for energy efficiency programs decreases by
about 1.3 percent. The largest change is a budget increase of
25 percent for the Federal Energy Management Program, which
helps the federal government reduce its energy use. EERE
estimates that the combined energy efficiency and renewable
energy programs, which cost about $1.3 billion per year, will
save the country between $76 billion and $125 billion in
energy costs by 2020.
The President's budget for fiscal year 2002 includes $9.1
billion in tax incentives over 10 years to encourage the use
of renewable energy, combined heat and power (CHP) systems,
and energy-efficient vehicles. For power producers, the
budget includes a new 10-percent investment tax credit for
qualifying CHP systems, an extension of the tax credit for
landfill methane power plants, an extension of the production
tax credit (PTC) through 2005, and an expansion of the PTC to
include more biomass energy facilities. The PTC provides
renewable power producers with a tax break of 1.5 cents per
kilowatt-hour (in 1992 dollars, adjusted for inflation) and
was formerly applicable only to electricity produced from wind
power, poultry waste, and biomass power produced from
dedicated energy crops. The
budget also includes a solar tax credit for homeowners.
Americans who install solar hot water or solar electric
systems on their homes would earn a tax credit of 15 percent
of the cost of the systems, including installation. The
credit has a maximum of $2,000 per person for solar hot water
systems and another $2,000 per person for solar photovoltaic
systems.
People buying hybrid electric vehicles would also earn a tax
credit of up to $4,000, with the amount determined by both the
performance of the hybrid system and the vehicle's fuel
economy. When fuel-cell vehicles become available, they will
earn an even higher tax credit -- at least $4,000 and up to
$8,000, depending on the vehicle's fuel economy.
Finally, the budget also proposes extending the tax credit and
excise tax exemption for ethanol and methanol from renewable
sources.
[From EREN Network News of 6 February 2002]
9. President Bush Unveils U.S. Global Warming
Initiative
President Bush unveiled a new U.S. initiative for addressing
global climate change on 14 February. Rather than
focusing on the absolute amount of greenhouse gases emitted
each year, the Bush administration's plan emphasizes
"greenhouse gas intensity," that is, the amount of
greenhouse gases produced per dollar of gross domestic product
(GDP). The initiative sets a goal of reducing the U.S.
greenhouse gas intensity by 18 percent in the next ten years
-- from 183 metric tons of emissions per million dollars of
GDP to 151 metric tons of emissions per million dollars of
GDP. The initiative relies on a combination of voluntary
emissions reductions, advances in energy technologies, and tax
credits for renewable energy installations, energy efficient
vehicles, and other energy technologies.
President Bush also announced a new initiative for cutting
power plant emissions of sulfur dioxide, nitrogen oxides, and
mercury. The "Clean Skies" initiative proposes a
system of tradable emissions credits that will lead to lower
emissions, similar to the system already in place for sulfur
dioxide emissions. If enacted into legislation, the initiative
will mark the first
time that power plant emissions of mercury have been
regulated. [From EREN Network News of 20 February 2002]
For a sampling of reaction to President Bush's climate change
initiative and full coverage of related news stories, visit http://dailynews.yahoo.com/fc/World/Global_Warming/.
10. Renewable Energy Resource Map
Available From U.S. Dept. of Energy's Energy Information
Administration -Map Provides Detailed View of Renewable
Resources in Region
The U.S. Department of Energy's Energy Information
Administration (EIA) has released the first in a series of
renewable energy resource maps. This map features the
Mountain Census Division and provides an integrated picture of
renewable energy resources: solar, geothermal, and wind energy
potential; indicators of hydroelectric, biomass, and wood
energy potential; and the geographic location of all renewable
energy power plants with a net summer capacity of 1 megawatt
or more.
This informative map is available in HTML and PDF formats at http://www.eia.doe.gov/emeu/reps/remap/mountain.html.
Other resources specific to Arizona and the southwest are also
available at this site, including "Appliance
Reports," which are brief statistical reports that
compare long-term trends in market share of about two dozen
appliances & electric air-conditioning in the United
States to trends in each geographic area.
11. Future U.S. Energy Use Depends on
Efficiency, Renewables - Annual EIA Report Looks at Impact of
Renewables and Efficiency on Demand
U.S. energy demand is expected to increase 32 percent from
2000 to 2020, according to DOE's Energy Information
Administration (EIA), but the forecast could change with
faster or slower penetration of energy efficiency and
renewable energy technologies. That conclusion is part
of the EIA's Annual Energy Outlook 2002.
Energy efficiency is measured at the national level by
"energy intensity," that is, the amount of energy
used per dollar of gross domestic product (GDP). The EIA
reference case -- often referred to as the "business as
usual" case -- already projects a steady decline in
energy intensity of 1.5 percent per year through 2020 due to
energy efficiency technologies. But a more rapid
development and market penetration of these technologies could
lower the U.S. energy demand in 2020 by 6 percent compared to
the EIA
reference case.
The EIA report also examined the effect of extending the
production tax credit, which expired at the end of 2001, to
the end of 2006. The report also assumed the tax credit
eligibility would be expanded - it currently applies only to
wind power and biomass facilities that draw on dedicated
energy crops, but the EIA assumed it would be expanded to
include all biomass and landfill gas facilities. That
change would boost the production of electricity from
renewable energy by nearly 50 percent by 2020 -- increasing
from the reference case projection of 15,000 megawatts to a
total of about 22,000 megawatts.
[from EIA press release summarized in EREN Network News of 9
January 2002]
12. Fitch Report Examines Effect of
Environmental Regulations on Power Industry
Fitch Ratings' Global Power Group has issued a report entitled
"Effect of Environmental Regulations on the Electric
Power Industry: U.S., EU, Australia, and New Zealand."
The Fitch report notes that "[t]he fossil fuel power
generation industry is the source of greenhouse gas (GHG)
emissions, and as a result, a number of countries have passed
regulations to limit the emissions that generators
produce. The potential for environmental regulations to
disrupt a power generator's ability to meet its financial
obligations prompted Fitch to explore the possibility in
depth." The report goes on to look at national and
international regulations, laws and policies, compliance
methods and other factors in assessing the future of
conventional and renewable-energy power generation
technologies.
A copy of this report, written by Fitch's Orli Almog, Kim
Herrmann and Gracie
Ebadan-Bola, is available at
http://www.bankwatch.com/corporate/reports/report.cfm?rpt_id=133038.
13. Enron Wind Purchased by GE Power Systems
GE Power Systems of Atlanta announced on 20 February its
intention to acquire coalition member Enron Wind. This
transaction, which is subject to regulatory and bankruptcy
court approval, is expected to close next month. "The
acquisition of Enron Wind represents GE Power Systems' initial
investment into renewable wind power, one of the fastest
growing energy sectors," said John Rice, president and
CEO of GE Power Systems. The wind energy industry is expected
to grow at an annual rate of about 20 percent, with principal
markets in Europe, the US and Latin America.
Enron Wind is a pioneer in wind power generation with
manufacturing operations in the US, Germany and Spain.
Headquartered in Tehachapi, California, Enron Wind has 1,600
employees worldwide. With fully integrated wind power
capabilities, Enron Wind offers power plant design,
engineering and site selection, operations and maintenance
services.
In a letter to the company's employees and colleagues, Enron
Wind President and CEO Adam S. Umanoff noted that "[a]
condition of the GE Purchase Agreement is the requirement that
Enron Wind and certain of its U.S. affiliated entities file
for reorganization under Chapter 11 of the U.S.
Bankruptcy Code. This filing was expressly required
under the GE Purchase Agreement to administer the sale of
Enron Wind's U.S. assets. No such bankruptcy filing has been
made for any of Enron Wind's European companies, the majority
of Enron Wind's workforce will transition to the new GE wind
entity. In the meantime, prior to the transaction's
close, we intend to continue to operate our businesses in the
ordinary course."
From company news releases:
http://www.gepower.com/corporate/en_us/aboutgeps/releases/022002.pdf
and
http://www.enronwind.com/newsroom/pressrel/022002ge.html]
14. Southwest Renewable Energy Fair to
be Held in August -"Resources Today to Ensure
Tomorrow"
Northern Arizona University and the Greater Flagstaff Economic
Council are hosting the fourth annual Southwest Renewable
Energy Fair on 9, 10 and 11 August in Flagstaff. This
fair will be held in conjunction with the Technical
Conference: Sustainable Development with Renewable
Energy Resources, on August 7th-9th, 2002. With more
than 50 vendors, most residing outside the Flagstaff area, the
fair will present the use of economic, ethical, and
environmentally friendly power alternatives and energy
efficient practices through education, demonstration, and
practice.
The fair will also include workshops, keynote guest speakers,
exhibits, and demonstrations of various products and services.
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