Pennsylvania\'s Energy Landscape

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Presented to Stambaugh Ness by Alexandra Chiaruttini of Stock and Leader

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  • 3/19/2009 Barton Education and Stock and Leader
  • Pennsylvania\'s Energy Landscape

    1. 1. Presented by: Alexandra C. Chiaruttini, Esq. Stock and Leader, LLP [email_address] 717-718-6402 January 20, 2010
    2. 2. Energy Landscape
    3. 3. Deregulation & Legislation
    4. 4. Current PA Energy Picture <ul><li>In Pennsylvania </li></ul><ul><li>Close to 60% energy generated by coal; 20% by natural gas </li></ul><ul><li>Electric Bills Contain: </li></ul><ul><li>Generation portion (75% bill) </li></ul><ul><li>Distribution portion (25% bill) </li></ul><ul><li>Tariffs Out </li></ul><ul><li>PPL --- 18%-36% </li></ul><ul><li>PECO 2011 </li></ul><ul><li>MetEd 2011 </li></ul>
    5. 5. Current PA Energy Picture <ul><li>Conservation </li></ul><ul><li>Efficiency </li></ul><ul><li>Alternatives </li></ul>
    6. 6. Measurement & Conservation
    7. 7. Measurement & Conservation <ul><li>Establish a baseline – Energy Modeling </li></ul><ul><ul><ul><li>Need a starting point </li></ul></ul></ul><ul><li>Benchmark with similar facilities and users </li></ul><ul><ul><ul><li>Need a measure….is this the norm </li></ul></ul></ul><ul><li>Focus on outliers </li></ul><ul><ul><ul><li>Identify greatest opportunities and maximize ROI </li></ul></ul></ul>
    8. 8. Alternatives
    9. 9. Drivers Toward Alternatives <ul><li>Economic incentives – cost and funding opportunities </li></ul><ul><li>Energy independence – National and local levels </li></ul><ul><li>Environmental awareness </li></ul><ul><li>All manifested in the form of </li></ul><ul><ul><ul><li>International agreements and protocols (Kyoto & Montreal) </li></ul></ul></ul><ul><ul><ul><li>New legislation </li></ul></ul></ul><ul><ul><ul><li>Utility mandates </li></ul></ul></ul><ul><ul><ul><li>Renewable and alternative energy credits (Recs & Aecs) </li></ul></ul></ul><ul><ul><ul><li>Climate initiatives </li></ul></ul></ul>
    10. 10. Technologies/Approaches <ul><li>Focus on Outliers – Buildings use 71% of electrical energy in U.S. – HVAC systems use more than 50% of total building energy </li></ul><ul><li>Geothermal </li></ul><ul><li>Solar </li></ul><ul><li>Wind </li></ul><ul><li>Biomass </li></ul><ul><li>Other </li></ul><ul><ul><ul><li>Cogeneration </li></ul></ul></ul><ul><ul><ul><li>Back pressure turbines </li></ul></ul></ul>
    11. 11. Funding
    12. 12. Drivers of Funding <ul><li>PA Alternative Energy Portfolio Standards Act </li></ul><ul><li>PA Alternative Energy Investment Act (2008 Act 1 Special Session) </li></ul><ul><li>House Bill 2200/ Act 129 </li></ul><ul><li>Economic Stimulus Incentives </li></ul><ul><li>Climate Change Legislation </li></ul><ul><li>Act 80 </li></ul>
    13. 13. Funding Tools <ul><li>Low Interest Loans </li></ul><ul><li>Grants </li></ul><ul><li>Tax Credits </li></ul><ul><li>REC (renewable) and AEC (alternative) </li></ul><ul><li>Bonds </li></ul>
    14. 14. What are Energy Credits? <ul><li>REC – wind, solar, geothermal 1 MWhr ~ $230/credit </li></ul><ul><li>AEC – biomass, landfill, methane </li></ul><ul><li>Who will need them? </li></ul><ul><li>How are they Measured & Exchanged? – PA Platform </li></ul><ul><li>PA Platform Vs. Federal Platform </li></ul><ul><li>What value do they have for a project? </li></ul><ul><ul><li>Today </li></ul></ul><ul><ul><li>In the Future </li></ul></ul><ul><li>Carbon Credit Market </li></ul><ul><li>www.dsireusa.org </li></ul>
    15. 15. What Expenses are Covered? <ul><li>Studies </li></ul><ul><li>Audits </li></ul><ul><li>Site Preparation </li></ul><ul><li>Retrofit equipment </li></ul><ul><li>Architectural Efficiency Projects </li></ul><ul><li>Engineered Efficiency Projects </li></ul><ul><li>Administration </li></ul><ul><li>Demand-Side Management </li></ul><ul><li>Equipment </li></ul><ul><li>Construction. </li></ul>
    16. 16. What Expenses are Generally Not Covered? <ul><li>Work/Analysis for Larger Project </li></ul><ul><li>Analysis to Prepare Application </li></ul><ul><li>Very small energy-Saving Projects. </li></ul>
    17. 17. Existing Sources of Money <ul><li>DEP </li></ul><ul><ul><ul><li>PEDA </li></ul></ul></ul><ul><ul><ul><li>Energy Harvest grants (non-profits and schools) </li></ul></ul></ul><ul><ul><ul><li>Growing Greener </li></ul></ul></ul><ul><ul><ul><li>Small business programs and pollution prevention loans </li></ul></ul></ul><ul><li>DCED </li></ul><ul><ul><ul><li>Machinery and equipment loan fund </li></ul></ul></ul><ul><ul><ul><li>PEDFA </li></ul></ul></ul><ul><ul><ul><li>First industries </li></ul></ul></ul><ul><ul><ul><li>Research and development tax credits </li></ul></ul></ul><ul><li>Fuels for Schools </li></ul><ul><ul><li>Focused on biomass </li></ul></ul>
    18. 18. Websites <ul><ul><ul><li>Newpa.com </li></ul></ul></ul><ul><ul><ul><li>PEDA </li></ul></ul></ul><ul><ul><ul><li>www.depweb.state.pa.us </li></ul></ul></ul>
    19. 19. Economic Stabilization Act <ul><li>Extended solar tax credit program </li></ul><ul><ul><ul><li>30% credit extended 8 yrs </li></ul></ul></ul><ul><li>Eliminated $2,000 maximum tax credit cap </li></ul><ul><li>Added tax credit incentives to package for many alternative energy projects </li></ul><ul><li>New bond programs for energy conservation </li></ul><ul><li>Extended tax credit for home efficiency and wind projects </li></ul><ul><li>USDA </li></ul><ul><ul><li>Energy Conservation & Efficiency </li></ul></ul><ul><ul><li>Alternative Energy </li></ul></ul><ul><ul><li>Loans and Grants. </li></ul></ul>
    20. 20. Keys to Applying for Funding <ul><li>Don’t rely on retroactive payments </li></ul><ul><li>Do your homework and research </li></ul><ul><ul><li>Select the right projects </li></ul></ul><ul><li>Tell a story </li></ul><ul><li>Jobs in PA </li></ul><ul><li>Develop good technical analysis/information </li></ul><ul><li>Be prepared to go within window of opportunity </li></ul><ul><li>Important to Vet: </li></ul><ul><ul><li>Consultants </li></ul></ul><ul><ul><li>New Technology </li></ul></ul><ul><ul><li>Expected Energy Savings – Guarantees? </li></ul></ul>
    21. 21. Other Opportunities <ul><ul><ul><li>Solar developers </li></ul></ul></ul><ul><ul><ul><li>Act 57 </li></ul></ul></ul><ul><ul><ul><li>Procurement by auction </li></ul></ul></ul><ul><ul><ul><li>Need to know what to compare: </li></ul></ul></ul><ul><ul><ul><ul><li>Auditing </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Procurement </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Developers </li></ul></ul></ul></ul><ul><ul><ul><ul><li>PARTNERS </li></ul></ul></ul></ul>
    22. 22. Take Aways <ul><li>Conservation, Efficiency, Alternatives </li></ul><ul><li>Sound Analysis & Planning is Key to Selecting the Best Projects </li></ul><ul><li>Technology in this sector is developing quickly – select carefully </li></ul><ul><li>Dollars and Incentives are plentiful & Varied, Include them in your Plan </li></ul><ul><li>Consider Layering the financial incentives for any one project </li></ul><ul><li>Plan to Spend Capital Up Front </li></ul><ul><li>Be Aware that programs Shift – the Project Has to Make Sense </li></ul><ul><li>Don’t Rush. </li></ul><ul><li>Evaluate needs and opportunities </li></ul><ul><li>Compare thoughtfully </li></ul>
    23. 23. Role of Counsel <ul><li>Identify Funding </li></ul><ul><li>Identify good partners </li></ul><ul><li>Assist in grant writing </li></ul><ul><li>Identify tax incentive programs </li></ul><ul><li>Identify quality consultants for: </li></ul><ul><ul><ul><ul><li>Auditing </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Alternative energy design </li></ul></ul></ul></ul><ul><li>Identify procurement specialists </li></ul><ul><li>Evaluate and counsel on: </li></ul><ul><ul><ul><ul><li>Energy contracts </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Alternative energy development projects & agreements </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Tax incentives </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Business structures </li></ul></ul></ul></ul><ul><ul><ul><ul><li>REC/AEC sales </li></ul></ul></ul></ul>
    24. 24. Questions?

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