Wednesday, December 23, 2009

Peter's Predictions for 2010

Lightspeed has invested across several cleantech areas, including solar (Stion), biofuels (LS9, Solazyme), clean coal (Coaltek), LED lighting (Exclara), and energy storage (Leyden Energy, f/k/a Mobius Power). Here are some of our cleantech predictions for 2010:

1. There will be increased availability of equity, debt, and project finance capital, along with an increased flight to quality. Despite 2009 being a slow year for venture capital firms raising funds (Q3 featured the fewest number of VC firms raising money in 15 years), the cleantech category appears to have drawn continued commitments.  Several domestic firms raised large cleantech-focused funds earlier this year.  Internationally — from China to Singapore, India to South Africa — a number of local venture and private equity firms are now raising multi-hundred million dollar funds to target cleantech investment.  As such, the global pool of equity capital targeted at cleantech will be greater in 2010, as investors continue to look at the sector as a source of investment opportunity.  The emergence of the debt markets from the depths of the fallout from late 2008 and the growth in capital flows from an improved stock market should also increase the availability of debt, tax equity, and project finance capital.

Despite the rise in availability of capital in 2010, investors will likely remain cautious.  We expect a larger share of dollars to go into emerging leaders and high-potential portfolio companies, as the number of new companies funded in first-time investments grows more moderately.  Larger funds may preserve capital to make more substantial bets in later-stage, “winner’s circle” companies.

2.  Massive project deployments and manufacturing capacity growth will be undertaken, as winners and losers become more apparent. In 2010, we expect a number of prominent VC-backed cleantech companies to be tested, as they emerge from R&D and initial customer acquisition and move into full-scale production and/or deployment mode.  Some companies will rise to market leadership, while others may fall, as the myths and reality of their technology, competitive edge, and ability to scale come to light.The “shakeout” will likely impact the sectors that have seen the most investment in recent years, such as:
  • Solar:  Many up-and-coming solar manufacturers have made bold claims about their capabilities.  As these companies start to ramp their manufacturing capacity, their validity of their claims on efficiencies, yields, cost economics, capital efficiency, and field reliability will become more readily apparent.  Companies will find it much more difficult to “scale first, optimize later,” as pressure on cash reserves increase significantly.
  • Smart grid:  As some of the massive project deployments with nationwide utilities roll out, whether new technologies can truly scale to millions of endpoints cost effectively and reliably will become clearer.  The utilities will also better judge the extent of the value created by the deployed networks and how far it extends beyond advanced metering into areas like demand response, distribution automation, and network management.
3. Momentum in plug-in hybrids and electric vehicles to continue, as a greater variety of vehicles starts to arrive to market.  Electrical storage will be the key enabling technology.
Nearly every major carmaker claims it will launch a plug-in hybrid electric vehicle (PHEV) or all-electric vehicle (EV) some time between 2010 and 2013, as concept cars start to become production models.  Notable target launches for 2010 include the Chevy Volt and Nissan EV-02.  Numerous startups will also look to enter the market, despite the challenges in raising the funding needed to compete in the automobile industry. Another trend to watch in 2010 will be an increased focus for fleet operators to consider adoption of HEVs and PHEVs, as the industry looks to rebound from the downturn and retire more of their aging fleet.  Adoption will still be early, but sustainability initiatives and new emissions regulations should help.The key enabler for the HEV and PHEV revolution will continue to be the battery technology.  While established companies like Sanyo, LG, and Hitachi are all attempting to adapt their lithium-ion battery technology for the automotive market, limitations with traditional chemistries have made it difficult for a clear victor to become apparent; startups have an opportunity to disrupt the market and become alternatives for OEMs.

For example, Leyden Energy (formerly Mobius Power, a Lightspeed portfolio company) is bringing to market Li-ion batteries that offer the high energy density that is critical for EVs, while providing a high degree of safety and long cycle life over a wide operating temperature range.  We expect there to be some healthy competition and progress made here in 2010.

4. 2010 could see several public exits from some of the emerging leaders; consolidation, M&A, partnership, and JV activity expected to growWith the IPO markets opening a crack in mid-2009 after nearly a year-long drought among VC-backed companies, investors appear cautiously optimistic about some public offerings in the cleantech area in 2010.  We expect that IPO demand in this sector will be driven by factors like the success of the A123 offering (although the stock has come down 35% from its high and stabilized at where it opened in September 2009) and the scarcity of quality cleantech public companies. Consolidation and vertical integration in areas like solar and biofuels will continue – many involving distressed companies that can no longer support the high cost of their assets and debt load.  A number of solar M&A deals were announced in 2009, including First Solar acquiring Optisolar for $400 million and MEMC acquiring SunEdison for $200 million.

A number of biofuels companies have been active in the last couple of years developing strategic partnerships and joint ventures in order to speed up their market entry.  LS9 and Solazyme (Lightspeed portfolio companies), for example, have teamed up with established giants like ChevronProctor & Gamble, and the U.S. Navyto further their development efforts.
We expect to see these types of transactions and relationships to continue in earnest in 2010, as large companies seek ways to tap into startup innovation, and startups seek ways to scale up in more capital-efficient fashion.

Peter Nieh is Managing Director and a founder of Lightspeed, covering the areas of cleantech, software and the Internet. 

Friday, December 18, 2009

Solyndra Files to go Public

Solyndra plans to go public and raise up to $300 million, the company said Friday.
The high-profiled solar company didn't specify how many shares or at what price for its stock offering, according to its filing with the U.S. Securities and Exchange Commission. Fremont, Calif.-based Solyndra has garnered lots of spotlight for its technology and for winning a $535 million federal loan to build its second factory complex near its headquarters.
The groundbreaking ceremony for the factory project in September this year was a big publicity event that drew Energy Secretary Steve Chu and California Gov. Arnold Schwarzenegger (and a speech by Joe Biden that was broadcast via satellite).
The IPO will be closely watched, and the degree of its success would pave the way for other thin film companies that want to go public in the next year. Thin film solar developers use little or no silicon in their cells, an approach to reduce manufacturing costs.
Solyndra uses copper, indium, gallium and selenium as key ingredients in the solar cells, and getting them to work well is a big challenge. But CIGS cells could do a better job of converting sunlight into electricity than other materials being used, such as cadmium-telluride and amorphous-silicon.
Most of the silicon cells in the panels today use crystalline silicon, which has historically been much more expensive.
Solyndra has announced more than $2 billion in sales deals in the United States and Europe. The announcements have painted an impressive picture of the company, which began commercial shipment in July 2008.
Solyndra sold 17.2 megawatts of panels from Jan. 1 to Oct. 3 of this year, the company said in the SEC filing. It sold 1.6 megawatts last year.
Solyndra posted $58.8 million in revenue and posted $119.8 million in net loss for the first nine months of this fiscal year (ending Oct. 3 2009), the company said in the SEC filing.
It generated $6 million in revenue and posted $232.1 million in net loss in the previous fiscal year that ended on Jan. 3, 2009.
Its customers include Alwitra, Carlisle Syntec Phoenix Solar, Geckologic, Solar Power Inc., and Sun System.
Solyndra said it has agreements in place for delivering up to 865 megawatts of solar energy systems (panels and racks) by the end of 2013.
The company's existing factory is running at an annual production rate of 45 megawatts, and it plans to expand that to 110 megawatts by the end of the next fiscal year, according to its SEC filing.
The second factory complex, which is under construction, would first have the annual production rate of 250 megawatts by the first half of 2012. The $535 million federal loan would pay for this, first phase of the factory project.
The second and final phase would add another 250 megawatts and cost another $642 million. Solyndra plans to use proceeds from the IPO to help pay for phase 2.
Solyndar said it also has applied for a federal loan guarantee of $469 million to help finance phase 2.
There has been a paucity of solar or even greentech IPOs in the U.S. market in the past year. The fist solar company to do in more than year was Specialized Technology Resources (STR), a Connecticut maker of encapsulants for protecting solar cells in panels.
STR (NYSE: STRI) went public in November, but didn't see a spectacular reception for its stock. The shares closed up 31 percent on the first day of trading, and haven't moved much since. The stock closed at $13.71 per share Friday, up 1.78 percent.
Another solar company, Trony Solar, was supposed to debut on the New York Stock Exchange last week. But the Chinese developer of amorphous silicon solar panels postponed its IPO, citing unfavorable market conditions.
Neither company stands out like Solyndra does, however. Founded in 2005, Solyndra has developed solar panels that look unlike most of the panels on the market today.
Instead of having a flat surface of a conventional solar panel, Solyndra's involves a series of solar-cell filled tubes lying side by side inside an aluminum frame.
The cylindrical design enables solar cells to capture diffused and reflected light, the company said. Solyndra, which also has designed a low-profile rack to hold the panels, is targeting the commercial rooftop market.
The panel-and-rack design shaves labor time and costs, the company said, a claim that has drawn skepticism from competitors and analysts.
Few thin film companies worldwide are public companies. But Solyndra wouldn't be the first CIGS developer to go public. Ascent Solar Technologies (NSDAQ: ASTI) in Thornton, Colo., went public in 2006 and is putting CIGS thin films on plastic.
The largest thin film company in the world is First Solar, based in Tempe, Ariz. First Solar (NSDAQ: FSLR) makes cadmium-telluride solar panels

Made in Washington

Starting this fall, residents and businesses will be able to buy the first made-in-Washington solar panels.
Arlington-based Silicon Energy LLC just received a key safety certification giving it the green light to put its products on the market. Thanks to generous state tax incentives for homegrown solar, Silicon Energy could be the first of several Washington-based solar companies helping boost the number of local solar-powered homes from the hundreds to the thousands.
“It means that all of a sudden, solar is no longer just the province of the Prius set,” said Mike Nelson, director of the Northwest Solar Center, part of Washington State University’s energy program. “This is solar for everybody.”
Solar power still represents a tiny fraction of the state’s energy portfolio. For example, Washington’s biggest solar installation, at Puget Sound Energy’s Wild Horse facility in Kittitas County, will pump out one-half of one megawatt when completed. The same plant’s wind turbines can generate up to 229 megawatts.
But Silicon Energy’s rollout is a key step in a long-standing state effort to spur a renewable energy industry. State lawmakers created a solar tax incentive in 2005, and expanded that incentive in this year’s legislative session.
One indication that business may be responding: Nelson said he is aware of at least four other groups developing business plans to try to follow in Silicon Energy’s footsteps.
Washington residents and businesses can now get payments of 15 cents for every kilowatt-hour of energy they generate. That rises to 18 cents with the use of a made-in-Washington inverter, a device that converts direct current into the alternating current that powers household appliances. But if they also use solar modules made in Washington state — which for now means Silicon Energy’s products — the incentive triples to 54 cents per kilowatt hour.
Based on the current usage pattern of Puget Sound Energy customers who use solar power, a homeowner using Silicon Energy’s products could cut monthly power bills in half on average and get a utility rebate of at least $1,050 each year.
When the 2005 law was passed, that incentive was capped at $2,000 per year and set to expire in 2014. But in this year’s legislative session, lawmakers raised the cap to $5,000 and extended the incentive to 2020.
When combined with a new, more generous federal incentive, a residential solar power system using Washington-made modules could pay for itself in roughly 10 years. Silicon Energy will sell to qualified contractors and installers rather than directly to homeowners, and the contractors will set the final price. But a typical residential system might sell for $20,000 to $30,000.
Silicon Energy, a wholly owned subsidiary of Arlington-based inverter manufacturer OutBack Power Systems, had been working for some time to get a certification from Underwriters Laboratories Inc., a third-party safety testing organization. It cleared that key hurdle on July 16.
Gary Shaver, president and CEO of Silicon Energy, said his company is busy right now fulfilling contracts for utilities. It is making 300 panels for Puget Sound Energy’s Wild Horse Wind and Solar Facility near Ellensburg in Kittitas County. Silicon Energy’s panels will add 50 kilowatts, which is about 16 to 25 times the capacity of an average home system.
Silicon Energy also already sold a system that now sits on the roof of Avista Corp.’s headquarters in Spokane. Dave Holmes, manager of applied research at Avista, a power company, said the system has performed well this summer with no problems.
“I think they’re going to be really busy producing panels here in Washington,” he said.
Silicon Energy’s rollout to the general public comes at a tough time in the solar power industry globally. Some large manufacturers in other countries ramped up rapidly to meet soaring demand, and the industry is now in the midst of a shakeout, with some products being unloaded at bargain-basement prices.
Silicon Energy’s Cascade Solar System has a couple of features that distinguish it from lower-cost panels. The modules are very strong, with glass stacked on glass, as opposed to the more typical plastic backing. The system has a much higher fire safety rating than a typical solar system. It is built without frames on the top or bottom, which prevents dirt and ice from accumulating and allows rain to wash the modules clean,
Even with the smaller tax incentive available to date, the number of solar energy users in Washington state has grown rapidly — though still a tiny minority. Seattle City Light, for example, has at least 150 customers using solar power, up from 47 in 2007.
The average solar customer is producing enough energy to account for half or more of the home’s energy usage, said a Puget Sound Energy spokesman.

Wednesday, December 16, 2009

1200 Applications for FIT in Ontario

Toronto, ON, December 16, 2009 - Seven hundred Ontarians from Ottawa to Windsor to Thunder Bay – including a member of the popular band Barenaked Ladies – will be celebrating a green holiday season after being the first to receive offers to generate renewable electricity under the province’s new feed-in tariff program.

The new microFIT program encourages the development of small-scale renewable energy (10 kilowatts or less) from a diverse range of producers, including homeowners, schools, farmers and small businesses. It is part of a broader Ontario feed-in tariff program (FIT), the most comprehensive program of its kind in North America. FIT is also aimed at encouraging community-owned and aboriginal-led projects.

“It's a thrill to be able to power my own lights while at the same time contributing to my city's electrical needs,” said Jim Creeggan, bassist for the band Barenaked Ladies. “Now that the microFIT program is up and running, it makes solar a realistic option for more households.  With enough homeowners on board, communities will have a greater impact on where our power is coming from.  I'm glad solar power is getting out of the fringe and into the mainstream.”

The FIT program, one of the cornerstones of the Green Energy Act, provides stable, guaranteed pricing to renewable energy producers of all sizes. It supports the province’s commitment to eliminate dirty coal-fired generation by the end of 2014 — the single largest climate change initiative in Canada. FIT and other initiatives under the Green Energy Act will support the creation of 50,000 “green collar” jobs.

“The new microFIT program literally brings power to the people,” said Gerry Phillips, Minister of Energy and Infrastructure. “It allows homeowners, farmers, schools and Mom and Pop businesses to help power our future and get paid for it, while investing in a new era of ‘green collar’ jobs and expertise.”

“The tremendous initial response to the feed-in tariff signals a strong future for renewable energy in Ontario,” said Ontario Power Authority CEO Colin Andersen. “We’ve cut the red tape and made it simpler for ordinary Ontarians to become electricity producers and they’ve raced to embrace green energy.”

The Ontario Power Authority has received nearly 1,200 microFIT applications since the program began accepting applications on October 1, mostly for residential roof-top solar power systems. These proposed projects have a combined capacity of about 8.6 megawatts (MW), enough to power about 1,000 average homes.

Between October 1 when the program launched and December 1, the Ontario Power Authority also received about 1,000 applications for projects over 10 kilowatts (kW). This large number of applications ensures there will be more than enough high-quality projects to deliver the 2,500 MW of renewable energy earmarked for the first round of the FIT program. These larger scale FIT applications are still being assessed.

The Ontario Power Authority estimates that the first FIT projects will generate in excess of $5 billion in investments in manufacturing, design, construction and engineering and lead to the creation of thousands of new jobs.

The Ontario Power Authority is responsible for ensuring a reliable, sustainable supply of electricity for Ontario. Its four key areas of focus are: planning the power system for the long term, leading and co-ordinating conservation initiatives across the province, ensuring development of needed generation resources, and supporting the continued evolution of the electricity sector. 

Tuesday, December 15, 2009

SF AB811 Residential Solar Financing

SAN FRANCISCO — Energy- and water-related building improvements that save money in the long run could be available early next year under a zero-down San Francisco financing program.
Solar panels, insulation, water-saving bathroom fixtures, and energy-efficient heaters and boilers are among the list of improvements that could be purchased and installed in residential, commercial or industrial buildings under the San Francisco Sustainable Financing Program.
The program allows The City to lend up to $50,000 for improvements from clean-energy financing firm Renewable Funding to a property owner, who would have up to 20 years to repay the money through property taxes.
"It simply doesn’t cost you any money out of pocket," Mayor Gavin Newsom said Monday.
Up to $150 million could be available, and the program is expected to launch in February or March.
"If people are interested in saving money, this is a pretty good program," Newsom said.
The program has been supported by the Board of Supervisors, which must provide final approval.

Monday, December 14, 2009

AB811 Residential Solar Financing Oakland

Oakland has become the latest city to allow residents to finance solar panels, insulation, new refrigerators and other efficiency improvements through their property tax bills. "This is a dream way to do solar," City Council President Jane Brunner said. "The problem with solar has always been the up-front costs. This eliminates that problem."

The council unanimously voted to join California First, a state plan based on the solar financing package first adopted by Berkeley in 2007.
The plan allows residential and commercial property owners to make energy improvements without paying up-front costs. Instead, they pay installments through their property tax bill over a 20- or 30- year period, in most cases at a lower interest rate than what they could obtain individually.

The investment can be recouped through savings on energy bills, coupled with federal tax credits and rebates as high as $15,000 from Pacific Gas and Electric Co. Contractors approved by California First perform the installation work and are paid up front by California First.

Since Berkeley adopted its plan, hundreds of cities, counties and 17 states have enacted their own versions. Oakland's program differs from Berkeley's in that it allows energy efficiency projects besides solar panels and the number of participating property owners is not capped.

"Property owners should start to see a savings on their energy bills on day one," said Garrett Fitzgerald, Oakland's sustainability coordinator. "That's our expectation." The city will bear no financial liability, although it will pay $20,000 for administrative costs, Fitzgerald said. The property tax payments stay with the property even if it is sold.

Some solar installers said the plans, so far, have had mixed results."On paper it's a very good idea," said Szilard Szabo, partner of Super Solar in Oakland. "But the financing seems to be falling through." He said some clients are obtaining cheaper interest rates on their own. Despite the number of cities adopting the program, he said he has not seen an increase in clients referred through the financing plans.

In Oakland, property owners can sign up for projects ranging from $5,000 to $75,000 or 10 percent of the value of their property. The program will get under way in June. Property owners should check the city's Web site,, for enrollment information in coming weeks.

Tuesday, December 8, 2009

Energy Efficient Fed Rebates?

NEW YORK ( -- President Obama proposed a new program Tuesday that would reimburse homeowners for energy-efficient appliances and insulation, part of a broader plan to stimulate the economy.
The administration didn't provide immediate details, but said it would work with Congress on crafting legislation. Steve Nadel, director at the American Council for an Energy-Efficient Economy, who's helping write the bill, said a homeowner could receive up to $12,000 in rebates.
The proposal is part of the President's larger spending plan, which also includes money for small businesses, renewable energy manufacturing, and infrastructure.
We know energy efficiency "creates jobs, saves money for families, and reduces the pollution that threatens our environment," Obama said. "With additional resources, in areas like advanced manufacturing of wind turbines and solar panels, for instance, we can help turn good ideas into good private-sector jobs."
The program contains two parts: money for homeowners for efficiency projects, and money for companies in the renewable energy and efficiency space.
The plan will likely create a new program where private contractors conduct home energy audits, buy the necessary gear and install it, according to a staffer on the Senate Energy Committee and Nadel at the American Council for an Energy-Efficient Economy.
Big-ticket items like air conditioners, heating systems, washing machines, refrigerators, windows and insulation would likely be covered, Nadel said.
Consumers might be eligible for a 50% rebate on both the price of the equipment and the installation, up to $12,000, said Nadel. So far, there is no income restriction on who is eligible. That would mean a household could spend as much as $24,000 on upgrades and get half back.
Homes that take full advantage of the program could see their energy bills drop as much as 20%, he said. The program is expected to cost in the $10 billion range.
It's not clear how the home efficiency plan would be administered - the government may issue rebates to consumers directly, homeowners might get a tax credit, or the program could be run via state agencies.
If consumers have to spend a lot of money up front to get the credit, it could throw a wrench in the works, David Kreutzer, an energy analyst at the Heritage Foundation, told CNN.
"This will not be something that's attractive to people who are having trouble already making their budget payments month to month or week to week," he said.
To keep consumers from having to spend thousands of dollars before getting reimbursed, Nadel said, one idea is to have contractors or big box retailers pay part of the cost up front.
Fraud issues could also come up, Kreutzer said.
"Any program that is going to run through a third party and is going to distribute billions of dollars needs to have lots of checks and balances to make sure there's not abuse," he said.
Nadel noted that as a way to guard against fraud, contractors would have to be certified to participate.
Energy company boost
Obama's new spending plan also calls for renewable energy companies to get additional support. That could come in the form of loan guarantees - basically, money the government uses to secure loans for startups.
In the original stimulus bill passed earlier this year, $6 billion was earmarked for such loan guarantees. But then lawmakers took away $2 billion to fund Cash for Clunkers - the popular program that paid people to turn in their old cars.
The $4 billion from the original bill has funded about $40 billion in loans, said the staffer on the Senate Energy Committee. Meanwhile, firms are hoping for another $4 billion in loan guarantees, since they have another $40 billion worth of projects that need funding.
A bill on energy efficiency reimbursements already has supporters in the Senate.
"Not only will [such legislation] increase our energy security and transform our energy infrastructure to a modern, clean and efficient one," Senate Energy Committee Chairman Jeff Bingaman, D-N.M., wrote in a recent op-ed column in the Hill, a Capitol Hill newspaper. "But it also will position the United States to lead in the development of clean energy technologies."

Sunday, November 29, 2009

Crews Begin Hanging Panels on Largest Solar Array in Martin County

Crews from Abundant Energy Inc. began hanging solar panels on the largest privately owned solar panel array in Martin County and quite possibly the largest to date in all of South Florida. The solar energy array will be used to power most of the privately owned office spaces in the Sawgrass Business Park on Indian Street in Stuart, FL in order to attract quality tenants who will benefit from working in a green office complex and potentially have zero a energy bill.

The solar array will consist of over 550 solar photovoltaic electricity generating panels, creating enough energy to power approximately 20 homes. 
The largest solar energy array in Martin County began construction a little over 4 weeks ago after the town was able to quickly issue permits to the solar energy contractor, Abundant Energy Inc. ( Though South Florida solar energy companies have been making little headway in the commercial energymarket with the exception of a few small projects, the first panels at the Sawgrass Business Park were installed this week. The Sawgrass Business Park is unlike anything Florida has seen before and is quite possibly the largest privately owned solar energy array in South Florida. “In Florida there is nothing like it, FPL just opened their Desoto Plant and Kennedy is coming online shortly, but as far as private investments this is definitely the biggest,” says Justin Hoysradt, VP of Sales at Abundant Energy, “This is just the tip of the iceberg, we are hiring and  have hired and trained six new full time installers for this project alone, not to mention we have a few more projects that are slightly smaller plus a healthy pipeline of residential projects, we have chosen not to participate in the recession.” The Sawgrass array will consist of over 550 solar photovoltaic electricity generating panels, offering enough clean energy to power 20 homes, and is specially designed for high wind speeds in South Florida.

Multiple investors which own the majority of the units in the Sawgrass Business Park made this project possible when they made the decision to install the array in late April of 2009. The project experienced slight delays with association approvals, securing some bank financing as well as additional guidance regarding the process for making application for a Federal Stimulus Grant. Fortunately Abundant Energy was able to leap each of these hurdles efficiently and professionally. The biggest issue was financing, “Even though this is a large project, the recovery was too quick for most banks to have an appetite for it, most banks are looking for projects over $20 Million in this industry, fortunately we were able to finance a portion of it ourselves to get the project moving.” says Hoysradt “it would have been a great opportunity for a bank to get its name out there in a positive way.” This project will fit the criteria for the investors to recuperate 30% of their initial investment within 90 days of completion with a grant issued by the Federal Government created by the American Recovery and Reinvestment Act of 2009. In addition to Federal stimulus money, the project also qualifies for funds from the Florida Solar Energy Rebate program.

Aside from solar energy incentives and stimulus money the investors are also looking to attract tenants for their units of which many are currently vacant. The offer of discounted utility bills and being able to work in an all “green” office park should attract quality tenants looking to build a strong, sustainable business in the Stuart area. Commercial Real Estate Broker, Derrick Christenson who is the listing agent for the properties says, “We have been getting a lot interest, business leases are ending and owners are aggressively seeking better pricing as well as better benefits for their business. You don’t get a much better benefit than great prices and solar power, the office is perfect for Green businesses.”

Wednesday, November 25, 2009

Obama Pledges Decrease in Carbon Gasses

WASHINGTON — President Obama is pledging a provisional target for reductions in greenhouse gas emissions in the United States, the first time in more than a decade that an American administration has offered even a tentative promise to reduce production of climate-altering gases, the White House announced Wednesday.

At the international climate meetings in Copenhagen next month, Mr. Obama will tell the delegates that the United States intends to reduce its greenhouse gas emissions “in the range of” 17 percent below 2005 levels by 2020 and 83 percent by 2050, officials said.

The figures reflect targets specified by legislation that passed the House in June but is stalled in the Senate. Congress has never enacted legislation that includes firm emissions limits or ratified an international global warming agreement with binding targets.

Mr. Obama will travel to the United Nations talks to deliver the promise in hopes of spurring significant progress there. He will appear Dec. 9, near the beginning of the 12-day session, on his way to accept the Nobel Peace Prize in Oslo on Dec. 10, officials said.

By making the pledge in an international forum, Mr. Obama is laying a bet that Congress will complete action on a climate bill next year and will be prepared to ratify an international agreement based on the commitment.

But White House officials acknowledged that those outcomes were uncertain. They will depend in large measure on whether the Democratic sponsors of the legislation can win 60 votes for a measure that is at the moment unpopular and whether major developing nations, notably China and India, deliver credible emissions reduction pledges of their own.

Mr. Obama has met over the past two weeks with the leaders of China and India, the fastest-growing sources of greenhouse gases, to discuss climate change and the Copenhagen conference. American officials said that both countries told the president they would be prepared to announce steps to reduce the rate of growth of emissions if the United States put a pledge on the table.

Neither has done so yet, although Chinese officials have hinted that they will announce a near-term target for reducing energy use relative to economic growth, or “carbon intensity,” before the Copenhagen conference opens.

“Obviously, we hope other major economies will put forth ambitious action plans of their own,” Carol M. Browner, the president’s senior adviser for energy and climate change, said at a White House briefing on Wednesday morning.

Mr. Obama, who had not previously committed either to emissions targets or to going to Copenhagen, has been under considerable pressure from other world leaders and environmental advocates to reassert American leadership on climate change.

Andreas Carlgren, the Swedish environment minister, said that Mr. Obama had now raised expectations for the Copenhagen talks, but he expressed a note of disappointment about the timing of his visit. He said he hoped Mr. Obama would come in the final days of negotiations, when dozens of other heads of government were planning to arrive.

A White House official said a return trip was “highly unlikely.”

It was unclear what effect Mr. Obama’s promise of domestic emissions reductions would have on the slow progress of climate legislation through Congress. Until now, the administration’s negotiators have said they will not get ahead of Congress in making promises in an international forum, but Mr. Obama has now essentially adopted the targets of a climate and energy bill that passed the House in June.

The House bill aims at greenhouse gas reductions of 17 percent below 2005 levels by 2020 and sharper cuts in the following decades, through a cap-and-trade system that includes most of the nation’s major sources of carbon dioxide emissions. Last month, a Senate committee passed a measure calling for a 20 percent cut by 2020, but that is expected to be weakened as the legislation moves through other Senate committees and onto the floor, perhaps next spring.

“By putting a serious number for U.S. emission reductions on the table, the president has just called the world’s bet and then raised it for our negotiating partners,” said Representative Edward J. Markey , co-sponsor of the House legislation.

Senator John Kerry, Democrat of Massachusetts, co-sponsor of the Senate legislation, said he believed that the president’s actions would give a boost to the Copenhagen talks and help move the Senate bill. He called the decision to declare an American target a “game changer,” domestically and internationally.

“By announcing a provisional target, contingent on the support of Congress, the president has defined a path to an international agreement that challenges the developed and developing nations to fulfill their obligations,” he said. “It lays the groundwork for a broad political consensus at Copenhagen that will strip climate obstructionists here at home of their most persistent charge, that the United States shouldn’t act if other countries won’t join with us.”

But Senator James M. Inhofe, the Senate’s most outspoken skeptic on climate change, said that Mr. Obama’s public pledge would do little to speed an international agreement and foolishly prejudged the outcome of a Senate debate that had barely started. Mr. Inhofe, Republican of Oklahoma, said that Senate climate legislation was “dying on the vine” and that the Senate would never ratify a treaty that did not require strong emissions reductions from major developing countries.

Tuesday, November 10, 2009

Energy costs to soar if no carbon deal, agency says

The world faces a surge in energy costs, as well as in planet-warming carbon emissions, unless it can swiftly agree a climate change deal, the International Energy Agency said Tuesday.
Arguing strongly for a global deal at the U.N. Climate Change summit in Copenhagen in December, the IEA said use of fossil fuels will increase quickly if policies remained unchanged.
Without an international agreement on climate change, the ratio of energy spending to gross domestic product for the largest consumer countries would double by 2030.
The world would have to spend an extra $500 billion to cut carbon emissions for each year it delayed implementing a deal on global warming, the IEA said in its annual World Energy Outlook.
"As the leading source of greenhouse-gas emissions, energy is at the heart of the problem and so must be integral to the solution. The time to act has arrived," it said.
IEA Chief Economist Fatih Birol told Reuters in an interview the world needed to stabilize the concentration of greenhouse gas emissions in the atmosphere at 450 parts per million of CO2 equivalent.
"The world needs to go to the 450 parts per million target, not only because of climate change but because of growing problems within our energy system and its possible implications again on the economy," Birol said.
Global energy demand would rise by an average of 2.5 percent per year over the next five years if governments made no changes to their existing policies and measures.
Under these circumstances, which the IEA called its reference scenario, world primary energy demand would rise by an average of 1.5 percent per year over the next two decades.
Oil demand, excluding biofuels, would increase by 1 percent per year to 105 million barrels per day by 2030 from 85 million barrels per day in 2008. This was a slight decrease in its demand forecast, reflecting the impact of the global economic downturn.
Last year the agency, which advises 28 industrialized nations, forecast oil use would reach 106 million barrels per day by 2030.
But the IEA stressed the trend toward heavier use of hydrocarbons would be unabated without a climate change deal.
"Fossil fuels remain the dominant sources of primary energy worldwide in the reference scenario, accounting for more than three-quarters of the overall increase in energy use," it said.
A key driver of energy demand would be inexorable growth in power generation, it said, forecasting in its reference scenario world electricity demand would grow 2.5 percent a year to 2030.
Stressing the need to move away from dependence on fossil fuels, Birol said that without a climate change deal, the European Union's annual energy bill would more than double to $500 billion by 2030, up from $160 billion in the last 30 years.
Oil prices soared to a record of nearly $150 a barrel in July 2008. They then collapsed to less than $33 last December, but have since recovered to around $80.
The price collapse, combined with the credit crisis, choked off investment and the Paris-based IEA has warned the oil market could surge back, damaging still fragile economic growth.
Birol said the oil price was likely to reach $100 per barrel by 2015 and $190 by 2030: "This means that if we don't do anything to our energy system, we will be in difficulty."
Bank of Ireland analyst Paul Harris said the IEA had taken a "rather cautious approach" in the report.
"There's an emerging consensus that the demand and supply balance is really going to start to tighten by 2015 which should sound the death knell for cheap oil."

Monday, November 9, 2009

November Workforce Education Conference in Albany NY Nearly Sold Out

The 2009 New Ideas in Educating a Workforce in Renewable Energy and Energy Efficiency Conference will be responsive to the national transition to a green workforce. There will be three plenary and general sessions; 17 breakout sessions; 52 presentations; and over 70 speakers sharing their experiences and expertise.

The conference will be held at the Albany Marriott in Albany, New York on November 19-20, with pre-conference workshops on November 18th."We have an exceptional line up of plenary speakers," said IREC's Jane Weissman, one of the conference organizers. Included in that impressive list are Mary Spilde, President of Lane Community College and Chair of the American Association of Community Colleges, Dan Lance from GE Wind, Jeff Spies of AEE Solar, Debra Rowe from Oakland Community College, and Steve Nadel from the American Council for an Energy Efficient Economy. U.S. Congressman Paul Tonko and NYSERDA's President Frank Murray will be luncheon speakers.

The conference is approaching capacity. According to conference organizers, 34 states and four countries are represented, including a German delegation of vocational education experts.
"New this year are two different sessions on job forecasts and labor profiles which will report on expected workforce development needs and the corresponding training programs required to meet projected employer demand," said Weissman. "We'll also look at how career pathways are being developed for individuals with diverse backgrounds and with different levels of skills and work experience."

A number of sessions will look at curriculum development and the different approaches that are being taken. Hands-on training is a key part of building a strong workforce and speakers will address integrating practical experience into classroom instruction. There will be sessions covering programs and activities initiated by federal and state governments.

All through the conference, there will be discussion about meeting challenges that are emerging with the growing need for quality training services. - New Portal for solar data

Industry consortium, leading professional magazine, and software developer collaborate to produce the solar industry's centralized repository of product specification data.

SolarTech, SolarPro magazine, and SolarNexus today announced the launch of a new, free resource for solar professionals called SolarHub ( The site provides a one-stop shop, aggregating detailed product specifications and allowing users to search listed products by a variety of attributes specific to each product type. Data in the site is maintained directly by manufacturers and the SolarHub team.

Tuesday, October 20, 2009

Biden Solar Plan?

The solar financing plan that originated in Berkeley in 2007 will become a national model, Vice President Joe Biden said Monday.
Biden's program, known as Recovery Through Retrofit, creates a framework for cities, counties and states to set up tax districts that allow residential and business property owners to install solar panels and make other energy improvements, repaying the investment over a 20-year property tax assessment.
"This is a remarkable validation of what Berkeley did," said Cisco DeVries, Berkeley Mayor Tom Bates' former chief of staff who drafted Berkeley's financing plan and now works at an Oakland firm that helps municipalities create similar plans. "For an idea that started in Berkeley, it's proven to be very non-ideological."
Since Berkeley adopted its financing plan, cities across the nation have adopted similar models, and California, New York, Texas and 11 other states have passed legislation making it easier for municipalities to create their own financing plans.
Berkeley's plan intends to eliminate the up-front cost of solar installation, which could total about $20,000 for an average bungalow, and the financial commitment that could follow property owners after they move from the home.
Under the plan, the assessment stays with the property, not the person. Property owners pay no money up front but pay about $180 a month on their property tax bill, an amount that is offset by the energy saved from generating solar power.
The plan, combined with federal, state and utility rebates, allows property owners to nearly break even on their investment.
Berkeley launched its plan last year with 40 homeowners. Of those, two dropped out and 38 have completed or nearly completed solar panel installation, according to the city's energy department.
The federal plan and those adopted in most other cities allow property owners to make other energy-efficiency upgrades, too, such as installing new windows, insulation and weather stripping.
Solar financing plans have been a boon for installers. A Berkeley firm, Sungevity, has expanded its staff to 35 and seen its business increase dramatically in California, including in Sonoma County and Palm Desert, which have adopted versions of the financing plan.
"Where it's available, it's a clear market driver," said Danny Kennedy, Sungevity president. "There's no question there's a demand out there, and this goes a long way to removing the barriers."

Read more:

More on CA's feed-in-tariff

Gov. Arnold Schwarzenegger has approved two major initiatives that will require utilities to pay consumers for generating extra power and will boost the payoff for certain solar facilities.

Homes, businesses and schools that have solar panels or wind turbines previously had no financial incentive to use less electricity than they generated. But AB 920, written by Assemblyman Jared Huffman (D-San Rafael), will encourage efficiency, supporters say.

SB 32, by state Sen. Gloria Negrete McLeod (D-Chino), requires utilities to purchase solar electricity from facilities that produce up to three megawatts and could increase installations on unused spaces such as warehouse roofs. The old limit was 1.5 megawatts.

The two bills will go into effect Jan. 1. Schwarzenegger signed them late Sunday, the last day to act on bills from this year's legislative session.

Under AB 920, the state Public Utilities Commission will set a rate for utilities to compensate customers whose solar or wind systems produce more power than they use in a year. Under California's current law, customers are not paid for any surplus electricity they feed back into the grid.

The state requires that when a consumer installs a solar power system, it be the right size to produce only enough power necessary for on-site use. Rebates from the California Solar Initiative, overseen by the utilities commission, discourage anything larger. So customers who later reduce their energy consumption often end up underutilizing their solar panels.

"The current system instills a perverse incentive for people to waste their solar electricity just so they don't give it away for free to the utilities," said Bernadette Del Chiaro, a clean energy advocate with Environment California, which sponsored the bill.

The new law could boost sales of photovoltaics, especially in regions with sunny summers. Homes that use less power than they did when their solar panels were installed -- such as those that add energy-efficient appliances, insulation or weatherproofing -- and those with children who have moved out can also benefit.

"This bill applies to individual homeowners as well as small businesses, farms, wineries, schools and even affordable housing developments," Huffman said in a statement.

Customers can either receive a check for the extra energy or have credit rolled forward on their electricity bills. Experts, however, said they should expect little profit.

SB 32, meanwhile, could spark more interest in commercial rooftop systems. The law expands an existing program to include municipal utilities, which now must purchase solar power at a set rate until they reach their portion of a statewide 750-megawatt cap. The limit was previously set at 500 megawatts.

The utilities commission will set the rate, which will be higher than market price after incorporating environmental compliance costs and other benefits, said Sue Kateley, executive director of the California Solar Energy Industries Assn., which sponsored the bill.

Between the sweeping solar installations in the desert and the small-scale ones on homes, she said, there had been a category of properties that had plenty of space but didn't use enough power to justify setting up huge solar panels.

But now, owners of large storage units and similar low-energy facilities will be able to install solar power systems and sell the extra electricity back to the utilities, a program known as a feed-in tariff.

The program took cues from countries such as Germany -- where, some in the industry have complained, a similar tariff format stimulated the market so much that prices of solar energy shot too high. Other critics are worried that the tariff could be too low to interest investors.

"We didn't want to replicate the German model, which was a social movement to create an industry," Kateley said. "In California, we already had an industry, but we wanted to fill a market gap. And within the community, it's really exciting because this law will create local jobs."

In a note to the state Senate on Sunday, Schwarzenegger encouraged the utilities commission to continue investigating an expanded tariff for small to medium-size producers of renewable energy.

"In order to meet our greenhouse gas emission reduction goals and a Renewable Portfolio Standard of 33% by 2020, we will need to use all the tools available under our existing programs," he said.

But Schwarzenegger vetoed a slate of bills -- including SB 14 and AB 64 -- that would have required the state to rely on renewable resources for at least one-third of its electricity. He has issued an executive order to meet the 33% goal using a different plan and supports efforts to create 1 million solar roofs by 2018.

Assemblyman Paul Krekorian (D-Los Angeles), chairman of a renewable energy committee, called the vetoes a dangerous setback. The bills, Krekorian said, would have created "green" jobs and steadied price volatility while cutting market manipulation from solar hubs outside of California. He said the vetoes would sour developers to the California market, leading them elsewhere.

"If we don't get started now," he said, "our opportunities to complete projects are going to be missed.

Saturday, October 17, 2009

Jiffy Lube QnA - Great Article

Jiffy Lube co-founder Stephen Spinelli talks to BusinessWeek's Amy Barrett about his company's success and the world of entrepreneurial opportunity
Spinelli: "Listen to your franchisees and make them your partners"Nick Anthony/Wonderful Machine
Stephen Spinelli Jr. knows entrepreneurship—both from the trenches and from 30,000 feet. In 1979, when he was just 24, Spinelli co-founded Jiffy Lube International and went on to become the chain's largest franchisee. Along the way he got an MBA from Babson College and, after selling his franchises to Jiffy Lube's new owner in 1991, went on to earn a PhD in economics at the University of London. After more than a decade teaching entrepreneurship, mostly at Babson, Spinelli took over as president of Philadelphia University in 2007. Spinelli, 54, spoke with senior correspondent Amy Barrett about Jiffy Lube's success and entrepreneurial opportunity.
Q: Why did Jiffy Lube take off?

A: Local gas stations were closing, taking [car service] bays off the market. We saw Jiffy Lube as a new technology. Environmental concerns [about oil disposal] and an aging population meant there were fewer do-it-yourselfers.
Q: What was your role in that startup?

A: We bought a mom-and-pop operation called Jiffy Lube in Ogden, Utah. I moved out to Ogden and started changing oil. I tell students all the time: "You gotta learn how to change oil—you have to understand your business." I wrote the operations manual, which was critical in allowing us to replicate the model.
Q: What did you learn from that?

A: It doesn't matter how big your company is, you work your rear end off. It is a false assumption that a smaller business is less risky than a larger one because it is more controllable. You end up having gaps because there's not enough scale and critical mass to have a team. Teams do better than individuals.
Q: Jiffy Lube ran into problems. Why?

A: We were doing so well, we started having this mentality: "This is easy. If we build it, they will come." If you start thinking that way, jump in a pool, cool off. That is a huge mistake.
In our case we got outlets where the operator was not trained as well. Or the location wasn't as good. It's death by a thousand cuts. It grew too fast. A vast majority of the stores were doing well, but the bad apples were spoiling the whole bunch.
Q: You ended up becoming a large Jiffy Lube franchisee. What are your thoughts on franchising in this environment?

A: I believe in franchising. It is a fabulous way to scale a business model. But the devil is in the details. Listen to your franchisees and make them your partners. That gives you an incredible competitive advantage. This is a perfect time to do the homework to be prepared to really grow. I'd be thinking about planning for growth next spring and summer if I were a franchisor.
Q: How valuable is formal education for an entrepreneur?

A: I don't think you necessarily need to be in college to do this. But you need to be a lifelong learner to survive. I think you will have to evolve your business model five times—and maybe five times in the first 15 years.
Q: Are you optimistic about entrepreneurship right now?

A: A perfect storm has been brewing, and it has been anti-entrepreneurial: Consumers and banks are going on strike at the same time. That has really slowed new venture creation. You have to use this time to have a good conversation with your customers, to understand what they are thinking. We will come out of this [recession]. There will be fewer competitors and there will be demand. So get ready.