Tag: Renewable energy

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Energy Minister Phillip Paulwell

ALMOST a year after net billing was suspended, there are indications that the programme is to resume, although Energy Minister Phillip Paulwell is yet to set a timeline.

He said recommendations have been made to the Office of Utilities Regulation (OUR) to resume processing licences. But, before that can happen, the Electricity Lighting Act must be amended and the Jamaica Solar Energy Association (SEA) raised concerns that nothing has been done to have the legislation amended.

At Wednesday’s national conference for the development of an energy services company industry in Jamaica, Paulwell said that the Government is committed to reopening net billing.

He, however, explained that while the law names the Energy Sector Enterprise Team (ESET) as the body responsible for regulating new generation capacity, it was felt that it (net billing) is not appropriately placed at ESET, and that the OUR is expected to resume processing net billing licences.

So far, more than 300 licences have been issued, but solar energy providers have not been able to interconnect to the JPS grid since May of last year.

David Barrett, president of SEA, says the association’s membership is still in a state of confusion.

“It’s static now (the sector) because people have no entity to get a licence from, they don’t know who to go to. Some persons have gone to the OUR or the JPS (Jamaica Public Service company) but they can’t do it because of the obvious reasons,” he told the Jamaica Observer last Thursday.

Over the months, entrepreneurs in the solar energy sector have complained bitterly of suffering millions in losses after the JPS stopped net billing to carry out an assessment of the pilot. The review was completed by the United States’ National Renewable Energy Laboratory and the report made public in June, but all grid interconnection for new net billing projects islandwide have still remained on hold.

Solar energy providers say the prolonged suspension has dealt their outfits a serious blow, arguing, too, that the JPS has too much power over the arrangement and that the Government needs to act decisively on the issue.

Barrett said the members are neither pleased with the pace of the process nor the new conditions that are being established.

“What has been decided is that the cap is to be five megawatts instead of 11 as it would have been in the previous phase, and that the cap for the individual locations will remain as they are. The association is not too happy about that because we feel that there is easy opportunity to increase potential for renewables in Jamaica without disturbing the grid in any way,” he told the Observer earlier this month.

Additionally, Barrett expressed disappointment that the association had not been invited to the table when the new cap was being set. “So we don’t have the information that fed into the decision-making process,” he stated.

Net billing permits JPS customers, who own renewable energy generators, to produce electricity for personal use and to sell excess energy to the light and power monopoly at wholesale prices, which are set by the OUR.

Jamaica Observer 

Ten companies submitted bids to build and operate renewable energy plants that run on solar, wind, water or waste, but two are in danger of being disqualified for non-payment of the bid security.

The Office of Utilities Regulation (OUR) received the bids for supply of up to 37 megawatt of renewable power to the grid on Wednesday and will determine the preferred bidders by April.

The bids included a 24.7MW waste-to-energy plant at US$110 million, by Green Waste Energy Inc; a 37MW wind plant at US$61 million by Wigton WindFarm Limited; a 20MW solar plant, at US$33.15 million, by WRB Enterprise Inc and a separate bid to build a 37MW solar plant at US$72.15 million, which contains three options.

Great Valley bid US$50 million to develop a 26.4MW wind farm; Tamarind Energy proposed a 36.3MW at US$76.96 million; and BMR Jamaica bid US$18.27 million for a 9.9MW wind farm to expand the existing wind farm that it is developing in central Jamaica.

The other four bids were a 37MW solar project at US$48.7 million with an alternative option by Eight Rivers Energy Company Limited; a 2MW hydropower project, at US$8.9 million, by Petroleum Corporation of Jamaica; a 37MW solar plant at US$77.14 million by Jamaica Energy Partners; and a 30MW biothermal energy plant, at US$93.8 million by Bio Energy Resources Limited.

“We are happy with the process. It was done in an orderly and professional manner,” said Angella Rainford of Eight Rivers Energy Company following the bid openings held at the OUR.

“The returns are attractive, but it’s also the right fit for the country as it mitigates against the reliance on oil,” said Rainford.

Eight Rivers took no chances and submitted a US$700,000 bid security.

Two of the 10 bidders – Green Waste Energy and Bio Energy Resources – did not put up the required security, OUR legal Chenee Rily disclosed at the bid opening.

The OUR required each bidder to submit security equivalent to one per cent of the project cost.

“The only two bids with firm capacity failed to offer a bid security it’s unfortunate,” said Cecil Gordon, the director of generation at Jamaica Energy Partners, in discussion with the Financial Gleaner at the OUR event. “Waste-to-energy gives a constant output so it’s firm capacity.”

Gordon explained that wind solar and hydro can fluctuate depending on external factors, including weather. He also indicated that waste-to-energy projects are more expensive to operate – “which means a lower return,” he added.

OUR said on Thursday that the decision on whether to disqualify the two waste-to-energy bids would be considered by the bid review committee when it convenes.

Last July, the OUR issued a Request for Proposals (RFP) from local and international interests to supply up to 37MW of electricity generation from renewable energy resources on a build, own and operate basis. Wednesday was the deadline for the receipt of bid documents.

This latest project is to complete an RFP process started in 2012 to identify interested entities to submit proposals for the supply of one or more plants of varying configurations greater than 100kW and up to 115MW of renewable energy. At that time, 78MW was identified from three successful bidders.

The Gleaner

A woman wears as mask while walking in a neighbourhood next to a coal-fired power plant on Nov. 26, 2015, in Shanxi, China.

The market is encouraging pension funds and institutions to jettison fossil fuels from their portfolios, waving a clear warning flag to investors about the financial future of oil and coal companies.

Fossil fuel stocks are performing poorly compared to the market as a whole — and perhaps most importantly, compared to renewable energy stocks, said Michael Liebreich, chairman of Bloomberg New Energy Finance, at a summit on climate risk put on by the nonprofit sustainability advocacy group Ceres.

Referring to investors who won’t divest and continue to own fossil fuel stocks, Liebreich pointedly said that the market was “divesting through value destruction” — in other words, cutting their holdings in traditional, polluting energy companies by slashing their value.

Renewable energy stocks have dramatically outperformed fossil fuels.

Over the last 10 years, the S&P 500 index is up just over 50 percent. Yet energy stocks over the same time period have risen only 1.3 percent.

For big investors to simply allow their holdings in big energy companies to fall toward a vanishing point of worthlessness is deeply irresponsible, observers say.

Indeed, former Vice President Al Gore, who shared the Nobel Peace Prize in 2007 for his work on climate change, compared the risk that some fossil fuel companies’ assets will become worthless to the danger of mortgage-backed securities, whose collapse triggered the 2008 financial crisis.

The nonprofit research group Carbon Tracker estimates that if the world changes its energy sources to keep climate change below 2 degrees Celsius, $2 trillion in fossil fuel assets will be stranded — that is, unusable, far less valuable, and in some cases, liabilities.

Huffington Post

Jamaica is to reduce greenhouse gas emissions by the equivalent of 1.1 million metric tonnes of carbon dioxide per year by 2030, as part of its global commitment to take climate-change mitigation action.

To bring this about, the island – as reflected in its nine-page Intended Nationally Determined Contributions (INDCs) document to the United Nations Framework Convention on Climate Change – has undertaken to implement energy policies that ensure the island:

– uses energy wisely and aggressively to pursue opportunities for conservation and efficiency;

– has a modernised and expanded energy infrastructure that enhances energy generation capacity and ensures that energy supplies are safely, reliably and affordably transported to homes, communities and the productive sectors on a sustainable basis; and

– achieves its energy resource potential through the development of renewable energy sources by increasing their share in its primary energy mix of 20 per cent by 2030.

Such policies are also to ensure that government agencies and ministries are a model/leader in energy conservation and environmental stewardship, and that the island has a well-defined and established governance, institutional, legal, and regulatory framework.

Fully implemented energy polices need, too, to ensure that private industry embraces “efficiency and ecological stewardship to advance international competitiveness and to move towards a green economy”, the document said.

The Gleaner

The oil-fired JPS power plant in Old Harbour Bay, St Catherine is to be replaced with a gas-fired plant.

The announcement of an agreement between Jamaica Public Service Company (JPS) and a Chinese firm is expected this week for the construction of the new energy plant at Old Harbour.

JPS and American company New Fortress Energy are executing separate projects at Old Harbour – the Jamaican utility company is building a new 190 MW plant, while Fortress is financing and developing the gas infrastructure to supply the plant with LNG.

Together, the projects are estimated at around US$500 million.

JPS said it will have no ownership in the gas infrastructure project nor contribute to the cost of developing it, but will solely be a client of New Fortress, which will build its pipeline to connect to the JPS plant. The same arrangement applies to the gas infrastructure under development by New Fortress in Montego Bay, which will feed gas to JPS’ Bogue plant.

The utility company said previously that the 190 MW combined cycle plant at Old Harbour is expect to cost close to US$300 million.

The name of the Chinese contractor will be disclosed only after the deal to develop the plant is finalised, JPS said. The utilitycompany had previously chosen Abengoa to develop the plant only to be embarrassed when the Spanish firm filed for bankruptcy protection in its home country just days later.

JPS is also in final negotiations with General Electric (GE) as the primary equipment supplier for the Old Harbour plant.

“JPS is currently finalising the agreements with both GE and the ‘EPC’ contractor and coordinating the start of this new generation facility with the completion of an associated LNG facility that will be built to provide gas. These two projects will total over US$500 million and begin operation in early 2018 with full commercial operation by the middle of 2018,” said JPS via email.

EPC is a categorisation, which stands for ‘engineering, procurement and construction’ contractor.

The plant’s advance GE turbines will utilise cleaner burning natural gas, replacing the heavy fuel oil currently used at Old Harbour, and will be able to integrate increased solar, wind and hydro resources as Jamaica moves towards producing more electricity from renewable resources.

“GE will provide four turbines – three gas turbines and one steam turbine the three heat recovery steam generators, the four electrical generators and the major controls,” said JPS.

Once the new Old Harbour plant is built, the current structure will be dismantled, and the property will resort to brownfield status, according to JPS spokeswoman Winsome Callum.

New Fortress is negotiating separately with the Electricity Sector Enterprise Team regarding its gas project, Callum said.

JPS has spent some US$4 million so far in preparing for the upgrade over the past 24 months.

The  Gleaner

NCB Group headquarters, The Atrium, at Trafalgar Road, New Kingston. The banking group’s energy initatives have cuts its electricity bill by 20 per cent across its network.

National Commercial Bank Jamaica (NCB) has cut its energy consumption by 20 per cent over the past four years and is projecting half-billion dollars of new savings over the next four.

By tinting its windows, changing its light and air-conditioning units, and installing some solar photovoltaic (PV) systems, the bank hopes to cut its electricity bill by another eight per cent in 2016.

If it achieves its latest goal, NCB would spend $140 million less on energy this year than it would if it had not implemented any of the energy-saving initiatives that started in 2011.

Back then, the financial institution forked out over $600 million to keep the lights on. Air conditioning accounted for more than 60 per cent of the energy use while lighting accounted for another 20 per cent, so it was decided that light-emitting diode (LED) lights would be installed across its locations, while high efficiency air-condition units and solar systems have been put in place at select sites, such as NCB’s head office on Trafalgar Road.

Reflective tinting on windows, roof insulation, and automated light controls have also helped protect the bank’s buildings from heat infiltration and have enhanced the energy-saving process.

This year, NCB plans to “continue implementing projects to install high-efficiency air-conditioning systems at relevant locations and increase the use of LED and PV panels,” according to the latest annual report.

So far, it has spent $500 million to implement various energy-reduction initiatives.

“We have an energy portfolio that is continuously being assessed, and our expenditure is guided by our environmental policy and, therefore, is subject to variations,” said NCB in reply to Sunday Business queries.

With the energy-saving expenditure, the banking group has so far avoided some $300 million in energy cost over the past four years, and expects to save another $500 million over the next four, based on current energy rates.

NCB can also boast a positive contribution to the environment. By reducing its energy consumption by 2.7 million kilowatt-hours – which is equivalent to the electricity used by 1,350 homes in Jamaica – it has reduced its footprint by approximately 1,800 metric tonnes of carbon dioxide annually. That’s the equivalent of the emissions given off by a plane making 25 round trips to and from New York, or by 100 cars driving from Kingston to Mandeville and back every day for a year.

Gov’t oil hedge underwater

In June 2015, the Government of Jamaica booked a hedge transaction to buy six million barrels of oil for delivery 15 months later at a strike price of US$66.74.

The mechanism used in this kind of transaction is called a ‘call option’, which gives the purchaser of the option the right, but not the obligation, to purchase the asset at a specified price the ‘strike price’ within a specified time. A month later, it bought another 15-month futures contract for two million barrels of oil and the average strike price of the two contacts is US$66.53.

We paid about $30 million to Citibank for the privilege of placing this bet on oil prices going higher than our strike price in 15 months.

When these contracts to buy crude oil were booked, prices on the world market was trading at about US$63 a barrel and had rebounded from about US$45 in January 2015. The government placed a bet based on its belief that crude oil prices would continue to rise well above the $66.53 strike price. If that were to happen and oil prices were to increase to, say, US$80-US$90 per barrel, the Government would be in the delightful position of having to pay only about US$66.53 per barrel for oil that would be trading at the much higher spot price on the international commodity market. The Government of Jamaica, senior executives at the Bank of Jamaica, and members of the oversight and technical committees created by the Government to manage the hedges, all seem to have bought into the belief that oil prices would climb higher than US$67 before the expiry date of the options.

The oversight committee is comprised of the financial secretary, Devon Rowe; the governor of the Bank of Jamaica, Brian Wynter; the managing director of the Development Bank of Jamaica, Milverton Reynolds; the managing director the Petroleum Corporation of Jamaica, Winston Watson; and Dr Vincent Lawrence. Mr Watson is known to have experience in oil trading and markets. Only Michael Hewett, an executive at Petrojam, was named as a member of the technical committee.

Wrong direction

One has to believe that the intention of the members of the government-appointed committees and all of those involved in the hedge transaction was a good one to try and protect Jamaica against that time in the 15-month period when oil prices might spike above US$67. While there is still considerable time to the maturity of the call options, right now the bet is not looking good and the best projections are for oil prices to fall even lower than the below-US$30 they traded at this week.

This week, three important financial institutions released projections indicating that oil prices could fall to US$10-US$20 per barrel and stay there for sometime. Goldman Sachs’ projection was at US$20, Morgan Stanley’s was US$20 and Standard Chartered, a bank with strong roots and connections in the Middle East and Asia, projected US$10 a barrel oil.

In the futures trading business, which is where these call options reside, when an option is bought with the expectation that the price of the commodity will increase but the opposite occurs, the option is said to be ‘underwater’. Given that these options were booked with the expectation for oil price to rise above US$66, and they are now heading in the direction of US$20, Jamaica’s call options on oil are seriously underwater.

A better alternative

In November 2014, a public official asked me about hedging because someone had written him an email to encourage Jamaica to hedge oil transactions on the upside, based on a scenario the email writer concocted about the state of affairs in the international oil industry. The public official was aware that I had traded oil futures for many years and had lived in the Middle East for more than two decades. I share below an excerpt from my reply:

“The recommendation needs study because taking a position means the Government and Jamaica will be guessing the direction of the movement of the price of this commodity. The writer makes it sound like making money on these bets (options) is a sure thing. It is not.

“There is always a risk. Suppose we bet on a certain price increase in a specific time frame, which we would have to if we are going to hedge, and prices instead of rising to, say, US$70/bbl from US$50 falls to US$35/bbl during our hedge horizon, we would suffer an important loss depending on the size of the contract. This is what apparently happened to that forward position Jamaica took on that futures contract on aluminium with the Russians and/or Glencore, the debilitating result of which you are very familiar.

“When oil went to US$9/bbl in the 1990s, if you had dared to tell anyone about the US$147 per barrel price which occurred in July 2008 they would have declared you mad. It’s a commodity; any card can play. On review, if the writer sees the prices as going one way, down, and OPEC is ‘dead’, why hedge? Do nothing, stay addicted to imported oil and go for the lovely ride to low-oil-price nirvana.

“The better alternative is to wean ourselves off the 98 per cent dependence on petroleum-based fossil fuels for our energy supplies. We really need to develop and use renewable energy from many sources, including bagasse, garbage, wind, water and solar.”

Aubyn Hill is CEO of Corporate Strategies Ltd and chairman of the Economic Advisory Council of the leader of the opposition.

The Gleaner

 

The clean-energy boom is about to be transformed. In a surprise move, U.S. lawmakers agreed to extend tax credits for solar and wind for another five years. This will give an unprecedented boost to the industry and change the course of deployment in the U.S.

The extension will add an extra 20 gigawatts of solar power—more than every panel ever installed in the U.S. prior to 2015, according to Bloomberg New Energy Finance (BNEF). The U.S. was already one of the world’s biggest clean-energy investors. This deal is like adding another America of solar power into the mix.

The wind credit will contribute another 19 gigawatts over five years. Combined, the extensions will spur more than $73 billion of investment and supply enough electricity to power 8 million U.S. homes, according to BNEF.

 “This is massive,” said Ethan Zindler, head of U.S. policy analysis at BNEF. In the short term, the deal will speed up the shift from fossil fuels more than the global climate deal struck this month in Paris and more than Barack Obama’s Clean Power Plan that regulates coal plants, Zindler said.
Data Source: Bloomberg New Energy Finance

This is exactly the sort of bridge the industry needed. The costs of installing wind and solar power have dropped precipitously—by more than 90 percent since the original tax credits took effect—but in most places coal and natural gas are still cheaper than unsubsidized renewables. By the time the new tax credit expires, solar and wind will be the cheapest forms of new electricity in many states across the U.S.

The tax credits, valued at about $25 billion over five years, will drive $38 billion of investment in solar and $35 billion in wind through 2021, according to BNEF. The scale of the new projects will help push costs down further and will stimulate new investment that lasts beyond the extension of the credits.

Data Source: Bloomberg New Energy Finance

Few people in the industry expected a five-year extension. Stocks soared. SolarCity, the biggest rooftop installer, surged 34 percent yesterday. SunEdison, the largest renewable-energy developer, climbed 25 percent, and panelmaker SunPower increased 14 percent.

Congress is expected to vote by the end of this week on the tax credits as part of a broader budget deal that also lifts the 40-year-old ban on U.S. oil exports. Oil producers have lobbied for years to lift the ban, but it isn’t likely to significantly affect either consumption of oil or deployment of renewables. Leaders from both parties reached an agreement on the bill late Tuesday.

The 30 percent solar tax credit was set to expire next year and will now extend through 2019 before tapering to 10 percent in 2022. The wind credit had expired at the end of 2014, and the extension will be retroactively applied from the start of 2015 through 2019, declining in value each year.

Wind power has had an especially tumultuous relationship with U.S. lawmakers, who have kept the industry’s credits alive through a disruptive ping-pong game of short-term extensions every year or two. “You open manufacturing plants and then you close them. And then you open them and you close them,” BNEF’s Zindler said. “It’s economically inefficient. This will give them a good five-year line of sight on what the market will look like, and that’s really important.”

Bloomberg

Sir Ronald Saunders

 

Small island states lost out to their larger, more industralised seniors at COP21.

 

The results of the climate change conference in Paris (COP21) give no reason for small island states to cheer. The agreement reflects many promises and little action.

The one item of concrete action is merely an undertaking to evaluate carbon emissions every five years — and even that has no teeth.

What is not in the agreement is a firm, legally binding commitment to limit average global temperature increases to 1.5 degrees Celsius. Also, not in the agreement is a legally binding commitment to provide developing countries with the funds needed to adapt to, and mitigate against the effects of climate change.

There isn’t even a commitment to a fund, in the sum of US$100 billion a year, that was frequently touted before the conference began.

Once again, the industrialised nations of the world — the worst polluters — took advantage of the weakness of the smallest countries of the world, which are the least polluters and the biggest victims of climate change.

To their credit, though, through the Alliance of Small Island States (AOSIS), representatives of small states did put up a good showing in Paris. Armed with the latest statistics and bolstered by a structured expert report released by the UN Framework Convention on Climate Change, they argued for the containment of global warming to 1.5 degrees Celsius, showing that, at 2 degrees, destruction would be widespread and irreversible. But, in the end, despite all the hoopla, applause and celebration, small states lost.

Representatives of AOSIS countries might have been flattered by a brief visit to them by US President Barack Obama, when he declared: “These nations are not the most populous nations, they don’t have big armies, they have a right to dignity and sense of place.” But, while President Obama was undoubtedly sincere in what he said, he also knew, even as he was saying it, that he could not deliver ratification by the US Congress of any agreement that limited carbon emissions or bound the US legally to warming no higher than 1.5 degrees Celsius.

So, the world has a so-called agreement, still to be ratified by the 196 participating countries, that only expresses an objective to limit global warming to “well below two degrees above pre-industrial levels”. The goal of 1.5 degrees Celsius, as described by Amber Rudd, the British minister for energy and climate change, is merely “aspirational”. In making her statement that the target of 1.5 degrees is aspirational, the minister was sending a clear signal to the British industrial world that driving down carbon emissions from fossil fuels is not an immediate objective and therefore will not affect their business.

In truth, the climate change action plans submitted by 188 countries would lead to a temperature rise as high as 2.7 degrees Celsius. And, if that is not bad enough, the signatories to the Paris agreement are under no legal obligation even to meet that objective; they are legally free to enlarge carbon emissions further. So, no cause for small island states to celebrate over that one, and profound reason for them to worry.

At three degrees, the size of islands will shrink, productive areas will be under water, people will have to move habitats inland and many will be forced to migrate, legally and illegally. We have to hope that all the scientists who predict this scenario are wrong.

On the money side, the developed countries declined to insert into the Paris agreement their often-made oral commitments to transfer funds to poorer countries in order to help them adapt. Yet, all the studies show that even the US$100 billion a year that was promised would not be enough to help developing countries build up a power system quickly or cheaply enough on renewable energy sources rather than coal or oil. Incidentally, even if the US$100 billion a year fund was achieved, access to it by small states in the Caribbean would be long and arduous, particularly if the criterion of “per capita” income continues to be applied as it is now by international financial institutions. The portion available to the Caribbean region would be a small fraction of the total sum.

Some may argue that there are two aspects of the Paris agreement that are beneficial to small states, therefore, attention should be paid to them. The participating countries recognised “the importance of averting, minimising and addressing loss and damage associated with the adverse effects of climate change, including weather events and slow onset events”. But, liability is completely ignored because it was opposed by the polluting industrialised countries. Recognition of a problem is far removed from committing to action to cure it.

Then there is the single binding legal requirement in the agreement. Every country is now required to come back every five years with new targets for reducing their carbon emissions. But there is no sanction if they fail to meet their previous commitment, and no sanction if they simply carry on business as usual.

COP21 in Paris may have been a triumph for some nations, but no self-respecting small island State should claim any satisfaction.

That is why each small State, individually and within the many organisations in which they are members — including AOSIS, the Commonwealth, La Francophonie, the Organization of American States and others — must now redouble their efforts to work on the developed country governments, but also to move beyond them to the conscience of the people of the industrialised world.

This is about survival and development — two defining challenges of this century for small states. It is the work of everyone; governments, businesses and civil society, all are involved and all could be consumed.

Sir Ronald Sanders is Antigua and Barbuda’s ambassador to the US; an international affairs consultant; as well as senior fellow at Massey College, University of Toronto, and the Institute of Commonwealth Studies, London. The views expressed are his own. For responses and to view previous commentaries:

www.sirronaldsanders.com.

The Observer

The biggest federal policy development of the year for renewables plays out on Congress’ last day of work in 2015.

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Lawmakers in the House and Senate passed a spending package today that includes multi-year extensions of solar and wind tax credits, plus one-year extensions for a range of other renewable energy technologies.

The pair of bills, which included tax extenders and $1.1 trillion in funding to keep the government running for the next year, passed hours before lawmakers adjourned for the holidays.

“May the force be with you,” said Senator Dianne Feinstein, urging her fellow Senators to vote in favor of the package shortly after the House approved the bills.

The force was certainly with renewables.

Under the legislation, the 30 percent Investment Tax Credit (ITC) for solar will be extended for another three years. It will then ramp down incrementally through 2021, and remain at 10 percent permanently beginning in 2022.

The 2.3-cent Production Tax Credit (PTC) for wind will also be extended through next year. Projects that begin construction in 2017 will see a 20 percent reduction in the incentive. The PTC will then drop 20 percent each year through 2020.

Also included were geothermal, landfill gas, marine energy and incremental hydro, which will each get a one-year PTC extension. Those technologies will also qualify for a 30 percent ITC, if developers choose. In addition, the bill expanded grants for energy and water efficiency.

Business groups and analysts say the extensions will support tens of billions of dollars in new investment and hundreds of thousands of new jobs throughout the U.S.

“There’s no way to overstate this — the extension of the solar ITC is the most important policy development for U.S. solar in almost a decade,” said MJ Shiao, GTM’s director of solar research.

According to GTM Research, the ITC extension will help spur nearly 100 cumulative gigawatts of solar installations by 2020, resulting in $130 billion in total investment. More than $40 billion of investment will be “directly attributable to the passage of the extension,” said Shiao.

The American Wind Energy Association expects similar growth. The group did not issue precise figures, but said the PTC extension would support tens of gigawatts of new wind projects through 2020.

The legislation also lifts a 40-year ban on exports of crude oil produced in the U.S. In exchange for lifting the ban, Democrats pushed for multi-year extensions of renewable energy tax credits and demanded that Republicans strip out any riders that would weaken environmental laws.

Both sides got what they wanted.

However, Pelosi publicly worried yesterday that she didn’t have enough votes to support the bill. Many Democrats expressed concern about the oil export ban tradeoff, saying it would increase subsidies to fossil fuels and boost carbon emissions.

Congressional leaders and the White House lobbied hard to convince the Democratic base that the bill would be a win for the environment.

“While lifting the oil ex­port ban re­mains atrocious policy, the wind and solar tax credits in the Om­ni­bus will eliminate around 10 times more car­bon pollution than the ex­ports of oil will add,” wrote Pelosi in a letter to lawmakers.

Katherine Hamilton, a partner with 38 North Solutions, called the bill “sausage-making at its most intense.”

“The product should be palatable for most parties in clean energy. Extensions for renewables and efficiency tax credits were key sweeteners. In addition, clean energy R&D funding, land and water conservation funds, and clean energy funds were included in the deal,” she said.

Other independent analysts found that the deal would be a net positive for the climate. Although emissions would increase slightly because of increased drilling activity, they would be easily offset by increasing renewable energy development and decreased coal consumption.

“Our bottom line: Extension of the tax credits will do far more to reduce carbon dioxide emissions over the next five years than lifting the export ban will do to increase them. While this post offers no judgment of the budget deal as a whole, the deal, if passed, looks like a win for climate,” wrote Council on Foreign Relations fellows Michael Levi and Varun Sivaram.

The tax credit extensions cap a big month for renewable energy policy.

In early December, world leaders agreed to a framework for lowering global greenhouse gas emissions — a deal that will leverage hundreds of billions of dollars in private investment for clean technologies.

And earlier this week, California regulators issued a new proposal on net metering that would preserve the retail rate paid to rooftop solar systems. The new rules — combined with the continued federal tax credit — will ensure strong activity in the top solar state.

National groups will now likely reset their sights on local battles around the U.S., said Hamilton.

“The renewable energy industries can turn their focus to state and local policies, siting and permitting issues, and compliance strategies for the Clean Power Plan,” she said. 

President Obama is expected to sign the bill into law today.

Greentech Media