Austin City Council and Austin Energy Looks to Be Moving Forward with 570 MWs of Wind Contracts

How do you replace coal power from Fayette? With contracts like those proposed by Austin Energy before the City Council on June 20th. Austin Energy is presenting two proposed contracts for 570 MWs of wind at a favorable price. While the contracts don’t directly replace power from the Fayette Coal Plant, these new contracts will help wean Austin off of coal in the future. Austin Energy is asking City Council to approve the negotiations of the contract.

The Lone Star Chapter endorses moving forward on negotiations with Duke Energy and EON Climate and Renewables to contract up to 570 MWs of new wind resources, to be built between 2014 and 2106 in Starr and Nueces Counties. We would request, however, that Austin Energy work with the developer to assure best practices to reduce bird and bat fatalities, including the use of radar technology and a commitment to stop wind production during migratory fly-over events. Other coastal wind companies have made similar commitments and implemented these projects.

 If AE is successful at reaching a contract for 570 MWs of new wind through these contracts at the announced price, AE could nearly meet its overall 35 percent goal by 2016, and meet all of its expected 2020 wind goal of 1,000 MWs by that date (see Table 1).

Table 1. Total Wind Resource, Austin Energy

Year	MWs
2009	439
2012-2013 wind added	295
2014-16 wind added	570
total in 16	1,304
expired contracts	-203
Total with expired contracts	1,101
Generation Plan 2020 Goal	1,001
Generation that would be added to Goal	100

Austin Energy has announced that they would seek other similar contracts in coming years if the projects are available at these competitive prices. At the proposed price, the power from these new wind units would be competitive with the prices we currently pay for power produced by the coal plants without the pollution or water use needed by those coal plants (see Table 2). Preliminary figures suggest we currently pay slightly under $30 per MWh for coal, about $40 dollars per MWh for gas and $50 dollars per MWh for our current amount of renewables. These new contracts, however would be closer to the price we pay for coal.  One of the ways that Austin can permanently retire its use of coal is by these contracts, as well as commitment locally to building out our solar and energy efficiency resources. In fact, we believe this could be accomplished by 2016 in part through these new contracts.

Table 2. Current 2012 Production Costs per MWh

Category	2012 Fuel Cost (or equivalent) per MWh	Estimated Total Production Cost
All Resources, 2012	$32	$42
Coal	$25	$30
Nuclear	$5	$15
Natural Gas	$57	$63
All Renewables on System	Fuel cost is PPA	$51
2012 Wind Contracts	Fuel cost is PPA	$35 to $45
New Wind Contracts	Fuel cost is PPA	$23 to $33

Note: These are estimates from Austin Energy’s Annual Performance Report Year Ending September 2012. Any errors in these estimates are Sierra Club’s alone.

Table 3 shows a hypothetical plan to rid ourselves of all 600 MWs of coal, by expanding our solar goal to 400 MWs, increasing our use of energy efficiency to 1,000 MWs of demand reduction by 2020, and expanding our wind goal from 1001 MWs to 1,349 MWs including these new resources being contemplated. This can be done for approximately the same price as we currently pay for generation.

 

Table 3. Comparison of Current Generation Plan and Get out of Fayette by 2016 with Added Wind and Solar

Category	Austin Energy’s Current 2020 Plan	Get Out of Fayette by 2016  Plan
% of Annual Electricity Demand Met	100%	100%
% of Peak Hourly Demand Met	100%	100%
% Generation from Renewables in 2020	34.3%	50.1%
% Capacity from Renewables in 2020	33.0%	48.1%
% of Peak Demand from Coal, 2016-2020	21.25%	0%
Carbon Emissions 2020 (metric tons)	4,495,900	1,788,600
Sulfur Dioxide Emissions 2020 (Metric Tons	889	266
Mercury Emissions 2020 (Pounds)	147	0
Total Expected Capital Costs through 2020 ($ million)	2,950	3,260
Water Intensity (gallons/kWh)	0.64	0.49
Annual Expected Fuel Costs in 2020 ($ million)	360	330
Expected Increase in Cost of Electricity in 2020 (¢/kWh)	2.7	2.6
Energy Efficiency Goal	800 MWs	1,000 MWs
Solar Goal (1/2 onsite)	200 MWs	400 MWs
Wind Goal	1,001 MWs	1,349 MWs

Source; Models run by Austin Beyond Coal on Austin Energy PRP Model Version 26 with PACE Energy Costs, June 2013;

Notes: The model makes assumptions about future operations, fuel and construction costs based upon data provided by PACE Consulting in 2009, with three changes made based upon more recent data. First the average fuel price for natural gas at combined cycle plants was reduced from $70 per MWh to $50 per MWh. Second, a one-time additional expense of $250 million for operating the coal plant was assumed in 2016 based upon expected pollution control equipment needed. Third, we assumed a new lower cost for the new wind contracts of $35 per MWh. The model is a static model, meaning for example, it does not take into account the ability of Austin Energy to purchase energy on the market, or sell its own generation resources into the market. Actual costs and projections would require a dynamic model, updated with more recent prices and projections.

Austin Energy to respond to Local Solar Advisory Committee recommendations by October — Could double solar goal to 400 MWs

In November of 2012, the Austin Local Solar Advisory Committee (LSAC)  and its 20 members from industry, commercial and residential building owners, financial institutions and others, released its strategic plan and recommendations on increasing the use of solar power in Austin, the principal one of which was to raise the goal for solar power from 200 MWs of solar power by 2020, to 400 MWs of solar power by that date. Earlier this week, at the City Council Emerging Technology and Telecommunications Committee meeting, both Austin Energy, represented by Debbie Kimberly, Vice President of Distributed Energy Services, and several members of the LSAC, including vice-chair Colin Meehan, formerly with Environmental Defense Fund and now with Comverge, an energy management company, addressed the recommendations made by the Committee and came up with a date by which Austin Energy would respond officially: October.

During the meeting this week, Kimberly said Austin Energy has already moved forward at least partially on a number of the recommendations, including coming up with a five-year plan to gradually and predictably reduce residential and commercial incentives and project five-year solar goals as part of that process, introduce more solar-freindly financing options and create a path for community solar and for non-profits and smaller commercial entities to take advantage of incentives. Kimberly announced that Austin was increasing solar power through Austin Energy programs and incentives and that there were currently 58 MWs of solar installed in the Austin area, including the 30 MW Webberville plant, and 18 MWs of rooftop installations at residential, commercial and government buildings, or about 1/4 quarter of the current 200 MW goal. About 2.5 MW of rooftop solar was added in FY 2013 alone.

She also said that Austin Energy would be hiring a third-party to assess their current “Value-of-Solar” rate that was adopted as part of the recent rate case, and make recommendations for potential changes. There was concern expressed that Austin Energy might back off of its current rate, and not also consider the economic benefits and community benefits of solar as part of that review. In addition, she announced that they would continue to move forward on Community Solar options, meet with the Local Solar Advisory Committee and begin discussions of whether Austin Energy could consider adopting a larger solar goal, like the 400 MW goal recommended by the LSAC. She said the goal was to have a final report by October 1, 2013.

Meehan and other members thanked both Austin Energy and the Committee for supporting the Local Solar Advisory Committee, and expressed a concern that Austin Energy might backtrack on solar goals and the Value of Solar,and  instead  told council they should move aggressively forward. They suggested that as rebates were lowered that should not lower overall budgets, but instead spread the incentives and opportunities to more projects. In particular, many members suggested that much of the growth would occur in commercial applications, but getting the incentives and financing correctly managed would be key to increase the amount of solar installations in this sector. As an example, considering credits on bills rather than direct payments could lessen tax implications for some commercial buildings, as well as considering a Value of Solar payment for commercial applications. Others noted that waiting until October to respond to a set of recommendations since November of 2012 was a bit long, especially since the budgets — including solar incentive budgets — for 2014 will be set later this summer.

Council Committee members Morrison, Riley and Spelman indicated they were looking for Austin Energy to work with the LSAC and come up with programs that were cost-effective but kept Austin as a leader in solar power. Sierra Club, Lone Star Chapter and the Austin Beyond Coal team are supporting the 400 MW recommendation and will look forward to working with Austin Energy and City Council to reach this goal by 2020.

– Cyrus Reed, Lone Star Chapter, Sierra Club

Austin moves forward on energy efficient codes for new buildings, while San Antonio waits…for now

There is an ongoing friendly competition between San Antonio and Austin about who is the greenest city in Texas. Austin passed a plastic and paper bag ordinance and now San Antonio is discussing a similar provision: CPS Energy set a 20 percent renewable goal, but then Austin Energy set a 35% renewable goal by 2020; Austin set a 100 MW solar goal, then raised it to 200 MWs by 2020,  but then CPS Energy signed a contract for 400 MWs of solar with OCI Solar, and the competition goes on.

In the area of Energy Codes, in 2009 the City of San Antonio passed a building code ordinance that not only adopted the 2009 IECC codes, but included a series of amendments that improve the energy efficiency above the 2009 IECC, such as cool roofs (Energy Star Certified) on all new buildings with low slopes (2:12 or less).  San Antonio also incorporated water efficiency into the amendments. Finally, San Antonio agreed to review and update their codes every three years toward a goal of net-zero carbon homes and commercial buildings by 2030. Similarly, Austin Energy and the City of Austin also adopted 2009 IECC codes with some good local amendments and set an  aggressive goal of making new homes “Net-Zero Energy Capable” by 2015, meaning that all new homes — with the addition of a solar PV system — could produce as much energy on an annual basis that they use, even as they too continually updated their base energy codes.

I’m here to report that based on recent events, Austin seems to be winning the race to get to net-zero energy homes more quickly than San Antonio. Austin Energy has developed a new code for all commercial and residential buildings that not only adopts the International Energy Conservation Code of 2012, but makes a series of local amendments on things like attic insulation, “cool” roofs,  and commissioning of commercial buildings that makes the Austin code  the most energy efficient in the state.

A public meeting was held today, June 6th, on the proposed codes at City Council and  there was no opposition, with both Sierra Club and Environment Texas signing up in support. City Council adopted the new codes unanimously and they will go into effect in the fall. While Austin is still short of its 2015 goal, it’s moving in the right direction, and the homebuilding, commercial and multi-family developers are generally supportive.

San Antonio is taking a slower approach. While the 2012 IECC was published in early 2012, analyzed by the Energy Systems Laboratory at Texas A & M, and recommended to state officials as significantly  better than the 2009 Code adopted by San Antonio and most major cities, the Citys’ Development Services has not recommended adoption just yet. Instead, Development Services and the City’s Sustainability Office has reconvened the Stakeholder Sustainable Building Committee (SSBC), which has already held a series of meetings that include participation from Sierra Club staff.

The SSBC has produced an excellent draft report showing that the 2009 Energy Codes adopted by San Antonio have been successful. Based on an admittedly small sample size, the draft report shows homes built in San Antonio since 2010 have been some 20 to 28 percent more energy efficient than base 2000 Codes, and that fully half of the homes built in San Antonio have met “Energy Star” or “Build San Antonio Green.” Both programs are certified to be 15% above the current San Antonio required energy codes.

Despite the positive news on the impact of the 2009 codes in San Antonio, the Committee at this point has not made a recommendation on adoption of the 2012 codes. In part they are on a slower timeline, wanting to determine whether the state — through the State Energy Conservation Office and the Comptroller of Public Accounts — will adopt the 2012 Code as the minimum state code, and also assess the development of the 2015 IECC codes, which are undergoing discussions this year. Moreover, many city officials are wary of adopting a new code after the previous code only went into effect a few years ago. The SSBC is scheduled to hold a series of additional meetings but reconvene in the fall to discuss possible approaches.

Sierra Club, Lone Star Chapter, local citizens and others, including Environment Texas,  have been engaged in these discussions and is urging the SSBC and the City of San Antonio to go ahead and adopt 2012 IECC for both commercial and residential now, with appropriate local amendments, rather than waiting for the state to act, or the 2015 codes to be developed. The codes have been analyzed, have been adopted in numerous cities, and training is available from the Energy Systems Lab. We look forward to working with the committee, the Mayor’s office, and the San Antonio community to make this happen.

Cyrus Reed, Conservation Director, Lone Star Chapter, Sierra Club

ERCOT announces more gains for Renewable Energy

ERCOT recently announced that renewable energy electricity sales in 2012 in the Texas market grew by some seven percent, with a gain of more than 15 percent in total capacity of those resources. A total of at least 13,000 MWs of renewable capacity was found in Texas in 2012. The announcement continues the growth of wind energy in Texas — which now equals about nine percent of total demand — but also signals the recent investment in solar energy, which more than quadrupled its use in Texas. 

The full announcement can be found here, but here are a couple of nice little charts showing total capacity and energy of renewables in Texas. 

 

Renewable energy reported

Fuel Type	2012 (MWh)	2011 (MWh)	Increase (%)
Biomass	288,988	137,004	110
Hydro	389,196	267,113	45
Landfill gas	537,966	497,645	8
Solar	133,642	36,580	265
Wind	32,566,009	30,769,674	5
Total	33,915,802	31,708,016	7

 

Capacity registered in Texas REC program*

Fuel Type	2012 (MW)*	2011 (MW)	2010 (MW)	2009 (MW)
Biomass	232	132	108	40
Hydro	33	33	33	33
Landfill gas	95	92	88	80
Solar	81	70	21	1
Wind	12,667	10,961	10,265	9,915
Total	13,108*	11,288	10,515	10,069

*Does not include generation in service prior to September 1999. Totals differ due to rounding.

Everything That’s Wrong with Coal — and Right about Clean Energy– in Two Minutes

http://sc.org/coal101

Today the Sierra Club released a new video highlighting the dangers of mining, burning and disposing coal. This short video offers a helpful resource for explaining the problems with coal-powered dirty fuels, the benefits of clean energy, and the need to move the country beyond coal.