March 12, 2008

It's the tale of two philosophies. Progressives are favoring more generous government subsidies for sustainable fuel production while conservatives are leaning the other way and supporting the current tax breaks given to oil companies.

The debate now rages in Congress where the U.S. House voted for the third time in more than a year to limit tax credits and raise additional taxes on oil companies. Members would then take the $18.1 billion in new revenue and shift that money over a 10-year period into renewable energy and energy conservation causes.

March 10, 2008

Energy policy isn't just consuming U.S. lawmakers. It's also dominating the Canadian agenda as well and particularly the province of Ontario.

The current government there recently unveiled its long-term supply roadmap that plans to double the amount of renewable energy by 2025 and refurbish or replace the province's base-load nuclear capacity. But it also expects to phase-out the use of coal-fired generation by 2014 -- a strategy that had to be put off for seven years.

March 7, 2008

State policies are the force behind the surge in green energy use. But if those efforts are to be optimized they must be complemented with the appropriate federal research, tax and regulatory policies.

About 26 states have enacted renewable portfolio standards that require utilities to offer a certain percentage of green energy within a specific time period. But they face a number of issues ranging from transmission constraints to inconsistent permitting standards among the jurisdictions. The Pew Center says that federal leadership is a must, particularly when it comes to funding research and development and creating national standards for grid interconnection.

March 5, 2008

When power outages spread 300 miles across Florida, dark visions occurred. It all seemed reminiscent of the 2003 blackout that left 50 million people in the United States and Canada without electricity -- a scenario that undoubtedly could occur again.

Utility planners have long warned that the nation's power infrastructure is not only stretched thin but also that is running on outdated technologies. Given the projected rise in electricity demand, the nation is still short generation and transmission. Improvements, no doubt, have occurred in some regions, but in others the problems are real and will ripple through their local economies.

March 3, 2008

Bridges, highways and sewer systems are built by private companies but often paid for through the use of tax-free municipal bonds. Such projects are typically guaranteed by the tax authority given to those municipalities issuing the instruments and therefore assuring the debt holders that they will be paid in full.

Without public financing, key infrastructure would not get built. Now, green energy pioneers want to use this same municipal bonding capacity to pay for clean energy projects, albeit the concept allows for privately-owned companies to operate city-owned projects and then to use the subsequent revenues to pay off the jurisdiction's obligation.

The projects are pegged to the creditworthiness of customers who enter into "power purchase agreements." Essentially, such contracts not only provide the initial capital to build expensive green projects but they also provide investors the necessary assurance they need. Meantime, a broad and reliable customer base provides the funding necessary to maintain a steady and comparatively inexpensive power source.