ATCAVE 2012. Expo February 29, 2012



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Renewable Energy Sources for Water and Wastewater Facilities ATCAVE 2012 Annual Technical Conference and Vendor Expo February 29, 2012 Presented by Sebastian Amenta PE Regional Program Director Comprehensive Environmental Incorporated

Renewable Energy Alternatives Hydrodynamic Electricity or Direct Use Geothermal Groundwater Closed Loop/Open Loop or Constant Thermal Source Solar Photovoltaic

HYDROELECTRIC ENERGY

TORRINGTON WATER COMPANY: HYDRO PUMP PROJECT

GEOTHERMAL ENERGY

Heat Pump System Litchfield WWTF Litchfield WWTF

SOLAR ENERGY

Key Technical Parameters Is there a need? Is your system a major power or heat user? Proximity to the power grid Land Availability Ability to permit and interconnect in a timely manner

Key Financial /Institutional Issues Is Net Metering allowed? Yes with some restrictions Ability to transfer generation credits to multiple accounts Yes Municipal Some restrictions Magnitude of the Financial Incentives Federal and State

The Connecticut Program Definitions CT Programs/Incentives Federal Incentives

Acronyms CEFIA= Clean Energy Finance and Investment Authority DEEP= Department of Energy and Environmental Protection DG= EDC= LREC= PPA= Distributed Generation (customer side of meter) Electric Distribution Company (i.e. The Connecticut Light & Power Company and The United Illuminating Company) Low Emission Renewable Energy Credit Power Purchase Agreement PURA= Public Utilities Regulatory Authority REC= RPS= Renewable Energy Certificate or Credit Renewable Portfolio Standard ZREC= Zero Emission Renewable Energy Credit

Renewable Energy Certificates or Credits ( RECs ) RPS = Each year a certain percentage of total retail energy sales of the EDCs must be purchased fromclass I, II, and IIIrenewable and energy efficient sources with the goal of 27% by 2020.

Net Metering Definition: When a behind the meter renewable electric system is generating more power than is used by the facility, with credit for excess production. Eligible Renewable DG Technologies (Behind the Meter): Solar, Landfill Gas, Wind, Biomass, Small Hydro, Fuel Cells, Municipal Solid Waste, Tidal Energy, Ocean Thermal Applicable Sectors: Commercial, Industrial, Residential, Nonprofit, Schools, Government, Agricultural, Institutional Applicable Utilities: The Connecticut Light & Power Company and The United Illuminating Company

Net Metering continued System Capacity Limit: 2 MW Aggregate Capacity Limit: None REC Ownership: Customer owns the RECs Meter Aggregation: Virtual Net Metering for Municipal Customers

ZREC Program Contract: Mid 2012 EDCs are required to competitively procure long term contracts for ZRECs with ihowners or developers of zero emission i generating systems or be subject to a penalty. Zero Emission Generation Systems: Class I energy generating systems that emit no pollutants (i.e. solar, wind, small hydro). System Size: 1 kw to 999 kw System Location: Customer side of the revenue meter (on site) ZREC Program Funding: Subject to periodic review by PURA and possible reductions, the procurement of ZRECs by the EDCs is $8 million in Year 1, increase by an additional $8 million per year in Years 2 through 6, plateau at $48 million in Years 7 through 15, and decline by $8 million per year in Years 16 through 20. Plan Approval: PURA must approve an EDC s Solicitation Plan before the EDC can start its competitive procurement of ZRECs.

ZREC Program continued Competitive Bid Procurement: 15 year ZREC Contracts 2012 contracts capped at $350 per ZREC ZREC price cap may decline by 3% to 7% in contract years 2013 2017 Bid Ranking: Bids received by the EDCs from developers or owners will be ranked in order from lowest NPV to highest NPV on the proposed ZREC price. Bid Selection: Bids selected by an EDC will be eligible to receive long term ZREC contracts under the EDC s Procurement Plan. Contract Approval: PURA must approve all proposed ZREC contracts in a regulatory proceeding under an EDC s Procurement Plan.

ZREC Program Summary Program Funding $8/year up to 6 years EDC Competitive Procurement 1 kw to 100 kw Small (may be non competitive) 101 kw to 249 kw Medium 250 kw to 999 kw Large ZREC Bid Price From System Owner or Developer ZREC = 1 MW hr $350 per ZREC Cap ZREC Cap reduced annually Projects with CCEF Funding are ineligible

LREC Program Contract: Mid 2012 EDCs are required to procure long term contracts for LRECs with owners or developers of low emission generating systems. Low Emission Generation Systems: Class I energy generating systems (fuel cells, biomass, etc.) that emit pollutants no more than: 0.07 lbs. per MW hr of nitrogen oxides 0.10 lbs. per MW hr of carbon monoxide 0.02 lbs. per MW hr of volatile organic compounds 1 grain per 100 standard cubic feet System Size: Less than 2 MW (1,999 kw) System Location: Customer side of meter plus net metering (on site generation) and tying into the electric grid.

LREC Program continued LREC Program Funding: Subject to periodic review by PURA and possible reductions, the EDCs must spend up to $4 million per year in Year 1 through Year 5, plateau at $20 million per year in Years 6 through 15, and decline by $4 million per year in Years 16 through 20. Competitive Procurements: 15 year LREC Contracts Contracts capped at $200 per LREC Bid Ranking: Bids received by the EDCs from developers or owners will be ranked in order from lowest NPV to highest NPV on the proposed LREC price. Bid Selection: Bids selected by an EDC will be eligible to receive long term LREC contracts under the EDC s Procurement Plan. Contract Approval: PURA must approve all proposed LREC contracts in a regulatory proceeding under an EDC s Procurement Plan.

LREC Program Summary Program Funding $4/year up to 5 years EDC Competitive Procurement Procurements at least annually LREC Bid Price From System Owner of Developer LREC = 1 MW hr $200 per LREC Cap Projects with CCEF Funding are ineligible

Proposed ZREC and LREC Program Schedule October 2011 EDCs Issued Request for Information (RFI) December 2011 EDCs File Solicitation Plan with PURA March/April 2012 PURA Issues Decision on Solicitation Plan May/June 2012 (Tentative) EDCs Issue 1 st ZREC RFP and 1 st LREC RFP August/September 2012 (Tentative) ZREC and LREC Contracts Submitted to PURA Contractors have 12 months to design, permit and build the project

Federal Tax Incentive Incentive Type: Corporate Tax Credit (Investment Tax Credit of ITC) Eligible Technologies: Solar, Wind, Biomass, Fuel Cells, CHP/Cogeneration, Geothermal Applicable Sectors: Commercial, Industrial, Utility, Agricultural Amount: 30% for solar, fuel cells, and small wind 10% for geothermal, micro turbines and CHP

Federal Tax Incentive continued Maximum Incentive: Fuel Cells: $3,000 per 1 kw Micro turbines: $200 per 1 kw Small Wind: No Limit Solar: No Limit Geothermal: No Limit Eligible System Size: Solar: No Limit Small Wind: 100 kw or less Fuel Cells: 0.5 kw or greater Micro turbines: 2 MW or less CHP: 50 MW or less Service Date: In general, credits are available for eligible systems placed in service on or before December 31, 2016

Benefits of Private Developer No up front cost Predictable cost of electricity over 15 years No need to deal with ihcomplex system design and permitting process No operating and maintenance responsibilities Net metering credit for electrical usage

Developer Agreements Electricity price ($/KWH) (PPA) Annual price increase factor Maximum price Land lease amount Termination schedule Buy out provisions/costs

Resources Database of State Incentives for Renewables and Efficiency www.dsireusa.org www.ctcleanenergy.com www.ct.gov/deep/energy www.ct.gov/deep/pura

Questions SebastianAmenta Amenta, PE P.E. samenta@ceiengineers.com Comprehensive Environmental Inc. Serving New England and the surrounding areas. 860 224 0442 www.ceiengineers.com