Tag Archives: energy
Brazil To Triple Funding For Renewable Energy
6/11/2013 3:22:10 PM | Joao Peixe, Oilprice.com As well as biofuel research Brazil has one of the largest, fastest growing economies in the world, and also some of the largest offshore oil reserves in the word. However, rather than relying on that oil to fuel its economic growth it has decided to focus on renewable energies and biofuel. The Brazilian government has announced that it will spend $2.85 billion on renewable energy and biofuel research and development, hoping that the new energy sources and technology will bring its energy industry into the modern age, and help it cut its carbon emissions. Alexandre Tanaka, from Financiadora de Estudos e Projetos (FINEP) a Brazilian research and finance agency, told Bloomberg that the President Dilma Rouseff wants to triple the funds available to innovative technology companies, as the country attempts to become a supplier of quality energy technology and processes, as opposed to purchasing from other countries. Under a new government program aimed at encouraging development in innovative technology, FINEP and the Brazilian Development Bank (BNDES) will provide loans to any companies working on renewable energy or biofuel research at rates as low as 3.5%. Mark Kenber, CEO of The Climate Group, said that the “government investment to support innovation in clean energy technology will drive job creation and offer green investors incentives and stability, which will help Brazil compete with in the fast expanding clean energy markets around the world. Brazil has huge potential to lead the global clean revolution, and with plans like these it looks like the nation is now ready to kick-start such efforts.” http://oilprice.com/…l-Research.html Read more at http://www.stockhous…QSCZO5VQWQzM.99 Continue reading
How to Attract Private Investment in Clean Energy
By the Editors Jun 10, 2013 Like a fresh wind setting in motion the blades of a giant turbine, a new idea for encouraging the development of clean energy has blown into the U.S. Congress. It is to allow renewable-energy companies to form master limited partnerships, a business structure that has long worked to attract investment capital to the oil and gas industry. Legislation in the Senate has support from Republicans and Democrats alike, not to mention the White House. We think it’s a neat idea, too. A master limited partnership offers the tax advantages of a partnership (the partners pay the taxes, not the corporation) even as its shares are publicly traded like ordinary corporate stock. The limited partners receive quarterly dividends, and these are typically higher than those paid to corporate shareholders because the business itself pays no taxes. This means the company can raise money from small investors at relatively low cost. Master limited partnerships would open a huge new pool of affordable capital for renewable energy, an industry that needs a lot of upfront investment and takes years to bring a big return. As things stand, clean-energy businesses have trouble attracting affordable financing. A large wind-energy company can turn to the “tax-equity” market to leverage its federal production tax credits. However, this market consists of just a handful of enormous companies (think of Google Inc., Chevron Corp., Honda Motor Co.) whose giant tax bills make it possible for them to take advantage of the wind company’s tax credits. Such investors get returns averaging 8 percent to 9 percent, according to data compiled by Bloomberg New Energy Finance. By tapping into cheaper money from individual investors, renewable-energy companies could raise $3 billion to $6 billion in financing by 2021, according to an analysis by Southern Methodist University. And the companies would pay less for the financing; average dividends paid by master limited partnerships amount to about 6 percent. MLPs have, since 1981, helped the oil and gas industry raise capital for refineries, pipelines and drilling operations. This market now includes about 120 master limited partnerships, and has a total capitalization of more than $440 billion, according to the National Association of Publicly Traded Partnerships. Renewable energy has been left out so far because federal tax law specifies that master limited partnerships must derive their revenue from depletable natural resources. (The law was written in the days before renewable-energy enterprises sought such large amounts of capital.) Expanding the MLP Parity Act to bring renewables into the game is only fair, and could bring new financing to nuclear power, energy storage, carbon capture and other initiatives that less obviously are considered renewable energy. The U.S. government has in the past subsidized clean energy directly. In 2011, some $48 billion went to various projects. This was stimulus spending, though, and stimulus money is drying up — even as the global market for clean energy keeps expanding. Although the government spending was useful, we much prefer a mechanism that makes private investment possible and appealing. According to a Bloomberg New Energy Finance report, by 2030 renewables will generate 50 percent of power globally. And between now and then, clean energy will attract $8.2 trillion in financing. To remain competitive in this growing market, the U.S. clean-energy industry needs the investment that MLPs would allow. To contact the Bloomberg View editorial board: view@bloomberg.net. Continue reading
Biofuels Will Play Integral Role In California’s Energy Future, Says New EBI Study
Biofuels developed from plant biomass and purpose-grown crops can substantially move California toward its ambitious energy goals, a new report says, but only through the wise allocation of feedstocks and the success of energy efficiency measures throughout the state. That’s the conclusion of “California Energy Future: the Potential for Biofuels,” a report of the California Council on Science and Technology (CCST) co-authored by Energy Biosciences Institute scientists Heather Youngs and Chris Somerville. The study is one of seven produced by the CCST’s California’s Energy Future Committee, which was tasked with understanding how the state can meet aggressive reductions in greenhouse gas (GHG) emissions required by California policy by 2050. The biofuels paper, according to lead author Youngs, a Senior Fellow at the EBI, addressed six scenarios of varied supply and demand options. They illustrate that the degree to which biofuels may help California meet its emissions goals depends upon how future demand for fuels rises or falls and what technologies are developed. Other factors include energy crop availability, investment decisions, public acceptance, and competing demands for renewable energy resources. “The concerns regarding large-scale use of biomass for energy in California are largely a matter of sustainable resource management,” Youngs said. “Judicious use of feedstocks will be required to obviate long-term sustainability concerns and maximize efficient resource management.” The researchers concluded that next-generation biofuels can reduce greenhouse gas emissions of transportation to meet the target GHG reduction goals of the state, but deep replacement of fossil fuels through implementation of low-carbon lignocellulosic ethanol and advanced biomass-derived hydrocarbons (drop-in fuels), and reduction in demand, are required. The challenge for California lies in landmark State Executive Order S-03-05, signed by Arnold Schwarzenegger in 2005. The target: reduce greenhouse gases (GHGs) more than 80 percent from 1990 levels by 2050. The California Legislature has also enacted legislation to encourage low-carbon technologies. Assembly Bill 32, The Global Warming Solutions Act of 2006, put a 2020 GHG target officially on the books. It also paved the way for the Renewable Portfolio Standard that requires 33 percent renewable electricity by 2020, and for adoption of California’s landmark 2009 Low Carbon Fuel Standard. The CCST’s first report in its California Energy Future series summarized the conclusions of a two-year study — in order to reach those goals, a little bit of everything will be required. This includes increased efficiency through reduced demand, shifts to electrification, decarbonized electricity production, and decarbonized liquid and gaseous fuels. Subsequent reports reveal the details, delving into nuclear power, transportation and building efficiency, electricity from renewable sources, and advanced technologies. One key finding of the Committee was that low-carbon fuels are absolutely required to reach the GHG reduction goals. Even with electrification of some vehicles, liquid fuels will still be required for aviation, marine and heavy-duty transportation. “Substantial amounts of low-carbon biofuels would be required even with optimistic efficiency, electrification, and implementation of other renewable energy sources,” the authors state. California has a policy goal of producing 75 percent of its biofuels from in-state resources. Biofuels can be produced using agricultural wastes, forest thinnings and harvest residues, municipal wastes, and purpose-grown energy crops such as perennial grasses and short rotation woody crops. According to the report, this could be difficult. The state could produce 40-120 million tons of biomass or 3 to 10 billion gallons of fuel each year, meeting up to 60 percent of the 2050 demand in the most optimistic case. Success will depend upon overcoming a number of economic, social and sustainability barriers, Youngs said. “Biofuels could reasonably be imported from other states or countries like Brazil,” she noted. “While imported biomass could supply in-state biorefineries to meet the 75 percent goal, this solution would be more costly than the import of biofuels themselves to meet the GHG reduction goals. Decisions regarding biomass use and biofuel import will greatly affect the ability of the state to meet its policy goals.” The authors expressed confidence that future technologies could be deployed to produce a new generation of low-carbon biofuels, like cellulosic ethanol and drop-in biofuels, to meet the demand by 2050. They also urged the proper choice of species and production criteria for feedstocks and fuel conversion technologies by region in the state. This includes development of arid-tolerant feedstocks, water-minimizing conversion technologies, use of grasses that sequester soil carbon and recycle nutrients, and use of plants that can tolerate poor soils and do not compete with food or feed production. All of these issues are being studied at the EBI in Berkeley and Illinois. Source: University of California – Berkeley Continue reading
