Show Me the Money: Benefits for Marine Renewables

Show Me the Money: Federal and State Public Funding, Benefits and Subsidy Programs for Ocean Marine Renewables Carolyn Elefant Law Offices of Carolyn Elefant/OceanRenewable Energy Coalition (OREC) Hydrovision Conference, Sacramento California July 18, 2008

U.S. Federal and State Public Benefits & Incentives for Wave, Tidal, HydroKinetic: Topics

The Color of Money

“ Show Me the Money” (Jerry Maquire)

“ Follow the Money”

(Deep Throat)

Earmarks

Very situation specific, so hard to track

Need experienced lobbyists to get real $$s - not a DIY operation

Examples of Earmarks:

$3.28 million to company for developing wave energy project & improved mooring system (HR 108-622)(Federal)

$8.5 million for solar in Florida (state earmark information on ocean energy difficult to find)

Funding Programs: Federal

Department of Energy

SBIR grant programs (ongoing, small amounts for early stage R&D)

State Energy Programs (DOE funding to states for renewables)

$7.5 Million Funding by RFP

Awards announced end of July 2008

$3-$5 million for advanced project testing (up to 8 awards, 50% cost share)

$1.-$2.5 million for market accelerators (up to 6 awards, no cost share)

Resource assessment, transmission integration, and regulatory streamlining

$1.5-$2.5 million for National Marine Renewable Centers (up to 3 awards, 50 % cost share)

Federal Funding - Appropriations

Appropriations Legislation

House Bill - $30 million for marine renewables; $10 million for hydro

Senate Bill - $30 million for entire water power program

No action likely in this Congress

State (Taxpayer) Funding Programs

Extremely Varied - Examples:

NYSERDA - $2.5 Million to bring Verdant RITE Project to commercial

OWET - $4.2 million in funding from Oregon to help develop & promote projects, conduct studies to aid commercialization of industry

Maine Technology Institute - $200,000 to ORPC to test tidal turbines

State Ratepayer Funded Programs

See http://www.cleanenergystates.org/ for overview of all state clean energy programs

CA Emerging Renewable Resource Program

PG&E seeks $30 million, w/$$s for Wave Connect - CPUC approves funds, then allows recovery through rates to bundled customers - PG&E requested $6million but rec’d. only $2 million

NJ Renewable Energy & Develop. Fund

$500,000 to OPT to deploy wave energy buoy

RI Renewable Energy Fund

$4 Million + low cost loans to Oceanlinx

Loan Programs

CREBs (Clean Energy Renewable Bonds)- for public projects, including marine renewables

DOE Loan Guarantee Program

Just implemented, up to 100% guaranteed, provided that developer usesFederal Financing Bank (otherwise 80%)

Many states have loans & loan guarantees

See www.dsire.com for state-by-state summary

Tax Credits & Incentives

State - see www.dsireusa.org

Federal

HR 6049 - PTC extender (1.9cents/kwh)

Expands PTC to include marine renewables & extends PTC through 2011

(only extends wind PTC 1 year)

Cost - $7 billion/10 years

Status:

Won’t pass House Paygo w/out cutbacks elsewhere

Renewable Portfolio Standard

No federal RPS

State RPS

Need to meet aggressive RPS drives clean energy programs

42 states have RPS and in most, wave, tidal and hydrokinetic will allow utilities to meet RPS obligations. Source: www.dsireusa.org

Feed In Tariff

Highlights of Proposed Inslee Legislation (7/08)

FERC will set Uniform national Renewable Energy Payment (REP) rates at levels that would provide for a 10% ROR on renewable investment, with rates differentiated by technology type & size

Utilities reimbursed for cost of REP purchases and interconnection through pass-through to a privately-run national renewable energy corporation (RenewCorps).

RenewCorps would levy systems benefit charge on every electric consumer in the U.S.

No double dip - companies that get REP rates don’t get other fed incentives or state RECs

Utilities would earn any associated RECs, to meet compliance with state RPS.

Feed In Tariffs - States

States with feed-in tariffs

California, Illinois, Michigan, Minnesota, and Hawaii.

In California, feed in tariff ranges from 8 to 30 cents, available for large and small renewable projects

Many other states are considering feed-in - trend to follow

Renewable Energy Credits

Most states with RPS programs have RECs. 1 REC = 1 MW/hr of renewable energy.

RECs from projects in RPS states are more valuable than those in non-RPS states

REC prices range from .005/kWh to $.056/kWh -http://www.eere.energy.gov/greenpower/markets/certificates.shtml?page=1 (DOE Table)

Carbon Offsets - “Wave of the Future”

What is an offset - from wikipedia:

A carbon offset is a financial instrument representing a reduction in greenhouse gas emissions. Although there are six primary categories of greenhouse gases,[1] carbon offsets are measured in metric tons of carbon dioxide-equivalent (CO2e). One carbon offset represents the reduction of one metric ton of carbon dioxide, or its equivalent in other greenhouse gases.