The state is vetting hundreds of conservation and renewable energy projects as it readies for President Obama's stimulus money, including a long-term plan to modernise its aging electric grid.
"The future of the grid is a priority,'' said state Secretary of Energy and Environmental Affairs Ira Bowles about the need to upgrade electric infrastructure to boost alternative energy production.
But Massachusetts may not be ready for several years to fully implement one key stimulus initiative. The USD787 billion package has USD37.5 billion aimed at energy investments, including USD11 billion for electric grid updates and so-called “smart” meters.
Obama has called for the installation of 40 million smart meters in American homes. Advocates say that could be a key to long-term conservation and efficiency.
Smart meters, which enable two way radio communication between the utility and monitors in the home, offer consumers real time info on their energy usage.
The goal is behaviour modification, promoting energy conscious behaviour by matching usage with pricing options. Cell phone users, for example, can already track costs per call in real time.
Smart meters “are the kind of technology that does lend itself to major federal intervention,” said Bowles. He said the systems need to be researched before utilities, consumers and regulators can go forward in Massachusetts.
Nstar is launching a pilot program in 2010, providing smart meters to 2,750 volunteer customers at no cost to them. The pilot program was mandated by the Legislature in 2008 as part of the Green Communities Act.
"The program will give Nstara chance to see what kind of reaction we get from residential customers when we ask them to conserve on some of the hottest days of the year when the overall electricity grid is pushed to extremes," said Nstar spokeswoman Caroline Allen. The grid is the interconnected network for delivering electricity from suppliers to consumers.
Like Bowles, Allen believes the major financial push from Washington for smart meter installation could be a tipping point.
"Anything that defrays the costs would be beneficial in getting new technologies in place," Allen said. "Consistent with other policies like renewable energy and energy efficiency, investments in the grid and emerging smart grid programs will only help move things along."
Massachusetts' list of potential energy projects will contain plenty of "low-hanging fruit," such as weatherisation and public building conservation, that can be started quickly and help create jobs in the conservation and renewable energy sectors, Bowles said.
The immediate focus "is on energy efficiency and more renewable energy," he said. But as the state makes long-term plans for transforming the grid and installing smart meters, it will look to models in other states. For example, in Texas, electricity distributor Oncor has embarked on a USD690 million project to install three million smart meters within four years.
Oncor households will pay for the program at USD2.22 a month over the next 11 years. If used properly, the system will generate conservation savings from six per cent to 15 per cent annually by allowing consumers access to near real-time information about usage via a monitor in the home or the Internet, Oncor spokesman Jim Greer said.
“Advanced metering systems are fundamental for our future and critical for the state as an economic engine,” Greer said. The company estimates conservation savings could negate the need for two or three CO2-emitting power plants to meet expected increases in demand.
Some three million more smart meters are expected to be installed by other Texas utility companies by 2015. A Bay State smart meter expert, who develops the software code for the devices being used across the country, said the future has at last arrived.
"Electric meters have been undergoing a transformation over the past few decades, but this transformation has now increased in size and scope," said Skip Ashton of Boston-based Ember, which develops radio chips, networking software and application code used in smart meters. "Installation has been slow because utilities do not rush into new technologies."
Showing posts with label Green Investments. Show all posts
Showing posts with label Green Investments. Show all posts
Small Businesses Receive Contracts for Green Technology
The US Environmental Protection Agency awarded USD1.6 million in contracts to 23 small companies to assist their efforts to bring promising new green technologies to market. This award is part of EPA’s Small Business Innovation Research (SBIR) program, which helps small business throughout America develop technologies that are more protective of our air and water quality and promote alternative sources of energy.
“Since 1982, EPA has been priming the pump of American ingenuity to better improve America’s environment,” said Kevin Teichman, Deputy Associate Administrator for EPA’s Office of Research and Development. “We believe that small businesses can be leaders for green innovation and they are proving that economic and environmental gains can go hand in hand.”
Among the many examples of initiatives to emerge from the program:
• Innova Tech of Morrisville, N.C. is developing an affordable new way for restaurants or food franchises with charcoal broilers to reduce emissions.
• DC Instruments of Thousand Oaks, Calif. will use sound waves to detect water leaks in aging water infrastructure pipes. Finding and repairing leaks promptly prevents costly pipe replacement.
• A previous year’s contractor, Compact Membrane Systems, developed a vapour recovery system that captures and re-stores escaping gasoline vapour at gas station pumps, saving fuel costs and preventing air pollution. The California Air Resources Board has mandated its use at more than 13,000 gas stations in California by April 2009.
The Small Business Innovation Research program was begun in 1982. Under the program, small businesses propose to EPA innovative technologies to protect human health and safeguard the environment. These projects are then evaluated by the Agency and those selected can receive awards up to USD70,000 with a six-month period of performance. Those projects with the greatest commercial potential can become eligible for up to USD225,000.
There are approximately 25 million small businesses in the United States and these businesses employ more than 50 per cent of US workers. They also develop an even greater per cent of our nation’s new technologies. Since the program’s inception, EPA has helped fund more than 600 small businesses. A small business must have fewer than 500 employees, and at least 51 per cent of the business must be owned by US citizens to participate in the program.
The 23 contract recipients received their awards in January 2009.
“Since 1982, EPA has been priming the pump of American ingenuity to better improve America’s environment,” said Kevin Teichman, Deputy Associate Administrator for EPA’s Office of Research and Development. “We believe that small businesses can be leaders for green innovation and they are proving that economic and environmental gains can go hand in hand.”
Among the many examples of initiatives to emerge from the program:
• Innova Tech of Morrisville, N.C. is developing an affordable new way for restaurants or food franchises with charcoal broilers to reduce emissions.
• DC Instruments of Thousand Oaks, Calif. will use sound waves to detect water leaks in aging water infrastructure pipes. Finding and repairing leaks promptly prevents costly pipe replacement.
• A previous year’s contractor, Compact Membrane Systems, developed a vapour recovery system that captures and re-stores escaping gasoline vapour at gas station pumps, saving fuel costs and preventing air pollution. The California Air Resources Board has mandated its use at more than 13,000 gas stations in California by April 2009.
The Small Business Innovation Research program was begun in 1982. Under the program, small businesses propose to EPA innovative technologies to protect human health and safeguard the environment. These projects are then evaluated by the Agency and those selected can receive awards up to USD70,000 with a six-month period of performance. Those projects with the greatest commercial potential can become eligible for up to USD225,000.
There are approximately 25 million small businesses in the United States and these businesses employ more than 50 per cent of US workers. They also develop an even greater per cent of our nation’s new technologies. Since the program’s inception, EPA has helped fund more than 600 small businesses. A small business must have fewer than 500 employees, and at least 51 per cent of the business must be owned by US citizens to participate in the program.
The 23 contract recipients received their awards in January 2009.
Financial Markets Grow 'Green' Companies
Investors see 'green' firms as less risky, charge lower interest rates
New research from the University of Oklahoma suggests that when companies go green, they can acquire funds less expensively than similar companies that do not. The finding is one of several from a study that shows improved green performance benefits corporations in ways previously not considered by economic analysts.
The ability to obtain financing at lower costs frees a company's other assets for further investment and future growth. Until now, evidence of this positive connection between a company's green practices and investments by financial markets has not been well reviewed.
Instead, researchers historically saw "green" practices as a negative or a cost to companies and argued they should be minimised whenever possible. This new study took a different view, opting to focus primarily on how investors perceive firms committed to green practices.
"The research indicates there is a longer term impact to a decision to go 'green,'" said Mark Sharfman, professor of strategic management at the University of Oklahoma's Price College of Business. "The financial markets seem to perceive firms that improve their environmental performance as less risky." The outcome is more willingness to invest in these firms.
Companies go green for any number of reasons including changes in environmental regulations, pressures from customers or because management believes it is the right thing to do. But surprisingly, not all financial markets view a firm's green initiatives in the same way.
Equity markets that trade a company's ownership shares, betting their value will either rise or fall, seem to place more confidence in firms that go green. But debt markets, which trade a company's IOUs, seem to hold an opposite view.
In general, the cost of equity is higher than the cost of debt, but here researchers associate stronger green practices with lower costs of equity and higher costs of debt. "This was our most surprising finding," said Sharfman. "We predicted that both types of capital markets would evaluate environmental investments in the same way and respond the same ways, so the fact that they did not was puzzling and deserving of additional research."
Taking equity and debt capital together, researchers find the weighted average cost of capital is significantly lower for green companies relative to non-green companies. The finding shows that any cost disadvantage on the debt side is more than offset by the cheaper cost of equity capital.
For investors, market outlays in green companies come down to managing risk. "If the market perceives improvements in resource utilisation but did not perceive changes in riskiness, the cost of capital would not change," Sharfman and his co-author Chitru Fernando, also of the University of Oklahoma, writes in an issue of the Strategic Management Journal.
But they also note that if the market perceived changes in a firm's riskiness as a result of improved green practices leading to lower costs of capital and decreases in overall cost base, then the firm's ability to make a profit correspondingly increased.
According to the researchers, several factors contribute to how investors perceive the riskiness of green companies. Green companies are seen as less likely to be subject to government penalties, catastrophic accidents or litigation.
Consequently, financial markets reward them by charging less for capital and allowing such firms to carry more debt. Both factors help explain why "greener" firms have better financial performance.
SOURCE: NATIONAL SCIENCE FOUNDATION
New research from the University of Oklahoma suggests that when companies go green, they can acquire funds less expensively than similar companies that do not. The finding is one of several from a study that shows improved green performance benefits corporations in ways previously not considered by economic analysts.
The ability to obtain financing at lower costs frees a company's other assets for further investment and future growth. Until now, evidence of this positive connection between a company's green practices and investments by financial markets has not been well reviewed.
Instead, researchers historically saw "green" practices as a negative or a cost to companies and argued they should be minimised whenever possible. This new study took a different view, opting to focus primarily on how investors perceive firms committed to green practices.
"The research indicates there is a longer term impact to a decision to go 'green,'" said Mark Sharfman, professor of strategic management at the University of Oklahoma's Price College of Business. "The financial markets seem to perceive firms that improve their environmental performance as less risky." The outcome is more willingness to invest in these firms.
Companies go green for any number of reasons including changes in environmental regulations, pressures from customers or because management believes it is the right thing to do. But surprisingly, not all financial markets view a firm's green initiatives in the same way.
Equity markets that trade a company's ownership shares, betting their value will either rise or fall, seem to place more confidence in firms that go green. But debt markets, which trade a company's IOUs, seem to hold an opposite view.
In general, the cost of equity is higher than the cost of debt, but here researchers associate stronger green practices with lower costs of equity and higher costs of debt. "This was our most surprising finding," said Sharfman. "We predicted that both types of capital markets would evaluate environmental investments in the same way and respond the same ways, so the fact that they did not was puzzling and deserving of additional research."
Taking equity and debt capital together, researchers find the weighted average cost of capital is significantly lower for green companies relative to non-green companies. The finding shows that any cost disadvantage on the debt side is more than offset by the cheaper cost of equity capital.
For investors, market outlays in green companies come down to managing risk. "If the market perceives improvements in resource utilisation but did not perceive changes in riskiness, the cost of capital would not change," Sharfman and his co-author Chitru Fernando, also of the University of Oklahoma, writes in an issue of the Strategic Management Journal.
But they also note that if the market perceived changes in a firm's riskiness as a result of improved green practices leading to lower costs of capital and decreases in overall cost base, then the firm's ability to make a profit correspondingly increased.
According to the researchers, several factors contribute to how investors perceive the riskiness of green companies. Green companies are seen as less likely to be subject to government penalties, catastrophic accidents or litigation.
Consequently, financial markets reward them by charging less for capital and allowing such firms to carry more debt. Both factors help explain why "greener" firms have better financial performance.
SOURCE: NATIONAL SCIENCE FOUNDATION
DOE Awards USD40 Million for Industrial Use of Alternative Fuels, CHP
Department Of Energy (DOE) announced in late January its award of nearly USD40 million to support the industrial use of alternative fuels and combined heat and power (CHP) technologies. The two separate award announcements included USD30.7 million over the next four years, subject to congressional appropriations, for cost-shared research and development of industrial systems capable of using alternative fuels.
The seven alternative fuel projects selected for more than USD9 million in funding this year primarily involve the development of fuel injectors, nozzles, fuel-handling systems, and entire integrated systems for gas turbines, boilers, and other combustion systems. The systems will need to handle fuels with high hydrogen content or with low energy content, such as those produced by anaerobic digesters, as well as fuels containing reactive species that can cause corrosion or generate pollutants. The systems will draw on such sources as wood waste and tire-derived fuel, and one project will use an anaerobic digester to convert cow manure into methane, which will fuel an engine connected to a generator.
An additional 10 alternative fuel projects have also been selected for awards of roughly USD19 million later this fiscal year, including projects involving internal combustion engines, microturbines, a hazardous waste incinerator, a fuel cell that runs on carbon particles (known as a "direct carbon fuel cell"), and a high-temperature solid oxide fuel cell, which can produce power from the hot gas produced by gasifying biomass and other fuels. Projects will also develop burners for viscous fluids, such as glycerine, and thermal oxidisers that can convert a variety of fuels into a combustible gas.
Such alternative fuel systems can also function as CHP systems by producing both electrical power and industrial process heat. Compared to the separate generation of electricity and heat, which typically achieve efficiencies of 45 per cent, CHP systems can operate at more than 80 per cent efficiency. DOE has selected six CHP projects for USD9.1 million in funding over the next three years, subject to congressional approval, including four projects that will receive USD4 million in funds this year. Those four projects will examine an automated control system, waste heat recovery from reciprocating engines, a chiller that runs on waste heat and a system that combines a microturbine and a chiller. Two more projects are slated to receive more than USD3 million later this fiscal year, and will develop a heat recovery system for fuel cells and a control system for combined cooling, heating, and power systems.
The seven alternative fuel projects selected for more than USD9 million in funding this year primarily involve the development of fuel injectors, nozzles, fuel-handling systems, and entire integrated systems for gas turbines, boilers, and other combustion systems. The systems will need to handle fuels with high hydrogen content or with low energy content, such as those produced by anaerobic digesters, as well as fuels containing reactive species that can cause corrosion or generate pollutants. The systems will draw on such sources as wood waste and tire-derived fuel, and one project will use an anaerobic digester to convert cow manure into methane, which will fuel an engine connected to a generator.
An additional 10 alternative fuel projects have also been selected for awards of roughly USD19 million later this fiscal year, including projects involving internal combustion engines, microturbines, a hazardous waste incinerator, a fuel cell that runs on carbon particles (known as a "direct carbon fuel cell"), and a high-temperature solid oxide fuel cell, which can produce power from the hot gas produced by gasifying biomass and other fuels. Projects will also develop burners for viscous fluids, such as glycerine, and thermal oxidisers that can convert a variety of fuels into a combustible gas.
Such alternative fuel systems can also function as CHP systems by producing both electrical power and industrial process heat. Compared to the separate generation of electricity and heat, which typically achieve efficiencies of 45 per cent, CHP systems can operate at more than 80 per cent efficiency. DOE has selected six CHP projects for USD9.1 million in funding over the next three years, subject to congressional approval, including four projects that will receive USD4 million in funds this year. Those four projects will examine an automated control system, waste heat recovery from reciprocating engines, a chiller that runs on waste heat and a system that combines a microturbine and a chiller. Two more projects are slated to receive more than USD3 million later this fiscal year, and will develop a heat recovery system for fuel cells and a control system for combined cooling, heating, and power systems.
Money is on Ethanol and Butanol
Anup Jacob, managing director of Virgin Green Fund, who will be at the WFES’08, shares his thoughts on renewable energy with Earthwitness.
Anup Jacob heads Virgin Green Fund’s San Francisco office, and has over twelve years of principal investing and investment banking experience.
Created by Sir Richard Branson about two years ago, VGF has big goals – and in coming years it intends to invest $500 million in companies in diverse sectors within renewable energy and resource efficiency.
“Our firm aims to become one of the world’s leading investors in the fight against global warming,” said Jacob. “We will do this by focusing on two major areas – helping to replace depleting reserves of conventional energy by investing in renewable energy resources such as solar, wind and biofuels, and by helping the world’s energy users more efficiently manage their use of limited natural resources through investments in areas like energy efficiency, energy storage and emissions reduction.”
Rather than invest in recent laboratory breakthroughs that are years away from commercial use, VGF looks for opportunities to propel proven technologies to the forefront. “We typically seek out opportunities to partner with superior management teams and established businesses seeking to raise expansion or growth capital. They may have early venture investments – or been bootstrapped – but they find themselves at a point where they need to expand their strategy,” said Jacob. For example, last summer VGF invested in Metrolight, a company based in Tennessee. Metrolight had been in business for over 10 years but needed the infusion of financial support and business development resources to bring its more efficient electronic ballasts to the rest of the world.
That’s not to say that VGF won’t make early stage investments. “On some occasions, we evaluate disruptive technologies in our core sectors when existing approaches do not work and a new solution has been created or is about to be created,” added Jacob. “While we feel it will be some time before biofuels are the complete answer and for a real market to develop, over the long term we do view ethanol and butanol as providing part of the answer.” In the spring of 2007, VGF backed Gevo, a next generation biofuels company that was created in the labs at Caltech.
Prior to Virgin, Jacob was a partner in TPG’s Aqua Fund, which focused on late stage investments in Water, Clean Technology and Renewable Resources companies. At Aqua, Jacob helped raise and invest over $300 million into a variety of companies across various Renewable Water and Energy sectors.
Jacob has served on the Boards of Jain Irrigation Systems Ltd, Metering Technology Corporation, and Scanship Environmental Solutions. He has also served as a CFO to portfolio companies and on several audit and strategic committees.
Prior to TPG, Jacob spent three years at Donaldson, Lufkin & Jenrette in New York and India in the Global Power and Merchant Banking groups. Jacob is involved in several children’s charities and environmental charities in India. He is a graduate of the University of Chicago.
Anup Jacob heads Virgin Green Fund’s San Francisco office, and has over twelve years of principal investing and investment banking experience.
Created by Sir Richard Branson about two years ago, VGF has big goals – and in coming years it intends to invest $500 million in companies in diverse sectors within renewable energy and resource efficiency.
“Our firm aims to become one of the world’s leading investors in the fight against global warming,” said Jacob. “We will do this by focusing on two major areas – helping to replace depleting reserves of conventional energy by investing in renewable energy resources such as solar, wind and biofuels, and by helping the world’s energy users more efficiently manage their use of limited natural resources through investments in areas like energy efficiency, energy storage and emissions reduction.”
Rather than invest in recent laboratory breakthroughs that are years away from commercial use, VGF looks for opportunities to propel proven technologies to the forefront. “We typically seek out opportunities to partner with superior management teams and established businesses seeking to raise expansion or growth capital. They may have early venture investments – or been bootstrapped – but they find themselves at a point where they need to expand their strategy,” said Jacob. For example, last summer VGF invested in Metrolight, a company based in Tennessee. Metrolight had been in business for over 10 years but needed the infusion of financial support and business development resources to bring its more efficient electronic ballasts to the rest of the world.
That’s not to say that VGF won’t make early stage investments. “On some occasions, we evaluate disruptive technologies in our core sectors when existing approaches do not work and a new solution has been created or is about to be created,” added Jacob. “While we feel it will be some time before biofuels are the complete answer and for a real market to develop, over the long term we do view ethanol and butanol as providing part of the answer.” In the spring of 2007, VGF backed Gevo, a next generation biofuels company that was created in the labs at Caltech.
Prior to Virgin, Jacob was a partner in TPG’s Aqua Fund, which focused on late stage investments in Water, Clean Technology and Renewable Resources companies. At Aqua, Jacob helped raise and invest over $300 million into a variety of companies across various Renewable Water and Energy sectors.
Jacob has served on the Boards of Jain Irrigation Systems Ltd, Metering Technology Corporation, and Scanship Environmental Solutions. He has also served as a CFO to portfolio companies and on several audit and strategic committees.
Prior to TPG, Jacob spent three years at Donaldson, Lufkin & Jenrette in New York and India in the Global Power and Merchant Banking groups. Jacob is involved in several children’s charities and environmental charities in India. He is a graduate of the University of Chicago.
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