CG: City of Austin residents, Austin Energy is now accepting volunteers who are willing to pay 5 times as much for their electricity so that they can be green. Who's in?
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Austin signs up for $250 million solar project
Webberville-area project would be among world's largest but also comes with cost questions.
By Marty Toohey
AMERICAN-STATESMAN STAFF
Friday, March 06, 2009
The Austin City Council approved a $250 million solar array Thursday that will be among the largest in the world.
The council gave a unanimous thumbs up to a private company's proposal to build and operate a 300-acre solar array on land near Webberville, east of Austin, and sell the power to Austin. The array is scheduled to be operating by the end of 2010.
Advocates said the project will help make Austin more eco-friendly and position the city among the nation's leaders in the solar-power industry, possibly attracting employers.
But critics said the project is too costly, particularly in a sliding economy.
Partly to address those concerns, the council decided it will sell the array's power to Austin customers who volunteer to buy it, instead of increasing every customer's bill.
But that plan requires customers willing to pay significantly higher monthly bills, though the amount is not known.
If too few customers sign up to use all of the electricity, the leftover will be added to everyone's bills, said Roger Duncan, head of Austin Energy, the city's electric utility.
A similar "Green Choice" offering started in January. It offers wind power at a rate two to three times as high as the standard price of Austin electricity.
That program has sold about 1 percent of its available energy so far.
Council Member Mike Martinez, who suggested offering a Green Choice solar program, said it will need to be accompanied by an aggressive promotional campaign.
"Austinites care about green energy," Martinez said, "and I think they'll be willing to do this."
Thursday's council vote means Austin Energy will pay $10 million a year for 25 years for the power generated by the array, which will be built and operated by Gemini Solar Development Co. Austin Energy will set aside 300 acres near Webberville for the project.
The array's 177,000 solar panels will be tilted at an angle to catch maximum sunlight in the late afternoon, when Austin's power usage is at its peak, according to Tim Lasocki, a Gemini spokesman.
During that time, on summer days when the sun is shining brightly, the array will add as much as 30 megawatts of generating capacity to the 2,900 megawatts of capacity Austin already has.
City officials say the array will keep Austin on pace to meet the city goal of getting one-third of its power from renewable resources by 2020.
The city, citing state privacy laws, will not say how much Gemini will charge for the power. But most estimates, based on other information the utility has released, put the cost at about 16.5 cents per kilowatt hour.
Austin Energy customers now pay 3.65 cents per kilowatt hour, spokeswoman Leslie Schneiweiss said.
The price of the solar power is high enough to raise concerns among several of Austin's large energy users, including Spansion, Freescale Semiconductor, St. David's Medical Center and the Building Owners and Managers Association of Austin.
Under Green Choice, the city's standard "fuel charge" is replaced by a green charge on a monthly bill.
The green charge for a solar package, if the cost estimates are accurate, would be about $160 a month for the average-value Austin home. The same homeowner would pay about $36 a month under the city's standard program. (CG: Who the has an average $36/month electric bill? I know I don't.)
The solar price isn't set, though. Duncan said new federal tax credits could reduce the cost by as much as a third. Duncan said he is also considering a Green Choice package that blends solar and wind, which would put the green charge between $80 and the $160 a month for an average bill.
Previous Green Choice batches sold out but were also fairly close to what Austin Energy was charging most customers, spokesman Ed Clark said. He said the current wind batch might have fewer takers because its charges are about two to three times as high as the standard option.
[email protected]; 445-3673
http://www.statesman.com/news/conten...0306solar.html
leftover excess energy not used, the company can just resell it back to the power operators.....thats what they do in europe, ppl who have installed solar panels in their houses and resell unused energy generated. Same is going to happen down here also in australia.....
I actually did a research paper on solar power in the Austin area for my graduate cost accounting class.
The comparisons in the article aren't entirely accurate as to the costs.
Solar power tends to make electricity at the time of the day when it is most expensive to make electricity, i.e. peak power.
This means that you can't really use the base rate 3.5 cents per kw/hour to really do a valid cost comparison.
During most hours of the day, the cheapest form of electricity is used, i.e. generally coal, or hydro if available (not avail in austin area, so we tend to get our power from coal)
During peak hours, more expensive stand-by generators like gas-fired plants are ramped up and put into action to provide the extra power.
So the 16 cent per KWh solar power would not quite be replacing 3 cent per KWh, power, but more likely be replacing natural gas at 10 to 12 cents per KWh, if my memory serves. I am not to sure about that gas cost, tho'. It does fluctuate a lot, and it was a few years ago that I did the paper, so I don't have much confidence in that.
The benefit to putting in such a solar plant is mainly to shield the utility from future fuel cost swings in the upward direction.
I will 100% guarantee you that fuel costs, both coal and gas, will get vastly more expensive 10 years down the line, quite possibly as soon as about 5 years from now. If you want I can go into great length about this.
This might not seem like the best idea for right now, but having this thing either coming right online about then, or under construction by then will be a godsend.
I haven't seen the exact proposal for this, and there are several types of solar power (thermal, photovoltaic, etc), so it is probably quite possible that a much smaller scale plant can be built and scaled up.
That is one of the other benefits of solar power is its' scalability. One can always easily add another row of mirrors/cells to increase capacity as demand rises.
All in all, don't dismiss this project off the bat as an envirowhacko idea. It does make a certain amount of economic sense, and more so than this particular article might suggest.
One thing that you want to keep in mind is that Austin MUST increase its electrical generating capacity anyways.
The cost of a NEW coal plant or a NEW gas plant will end up costing more than the 3 cents per kwh as well. If you want to compare costs, the 3 cent figure given here is not the right cost to use.
That actually works rather well in Austin, simply because of the la ude. I think we will see a lot of those cells going up in the next 10 years.
the startup costs is alot, and you will not recover that amount in 8-10yrs, thats why alot of consumers are askn to govt to legislate such a program where excess energy is resold to keep the bills down.....
But what price would Austin Energy be able to sell it back at? It's still very expensive electricity and any potential customer is going to have plenty of cheaper options. It's not like Texas is overflowing with utility companies that share Austin's drive for going green.
I am pretty sure that we will start to see that payback time start to come down a bit in the future, probably a lot actually.
The thing is that those panels, even with a 10 year pay-back time, proabably have 30 to 50 year usuable lifespans.
The some of the first photovoltaic cells that were created in the 50's and 60's are still actually producing power. Capacity does go down over time, but there aren't any moving parts to wear out.
and dont forget that carbon scheme alot of countries are complying too = i think its a load of that consumers have to bear the grunt of the deal, where energy/water bills increase 5-10%
Good points. And for the record I'm a fan of solar power. Less than a year ago I was about to sign a contract to put a 3kw solar array on my roof, but then the whole financial mess blew up and I decided it wasn't a good time to s out $30,000, even with Austin energy and tax credits eventually reimbursing me a little over half of that.
That being said I have a problem with what Austin just did because it will impact everyone, whether they want solar power or not, and I just don't think it's a great time to make everyone's electric bills go up.
Austin Energy rates:
Winter: 3.55c/kWh for first 500 kWh, 6.02c/kWh thereafter
Summer: 3.55c/kWh for first 500, 7.82c/kWh thereafter
"plus a Fuel Adjustment Charge calculated by an adjustment for all variable costs calculated according to the Fuel Adjustment Clause Tariff" amounting to 3.544 c/kWh since January 1, 2008. You would suppose that clause would not apply to solar customers.
So, saying it's quadruple is pretty misleading. In the summertime, effectively 5c/kWh more and much of the solar will come during the peak usage period of the day, reducing the need to fire up additional expensive capacity. There are a lot of people in Austin who will go for this, more power (pun intended) to them.
16.55 cents/kWh is less than I was paying in Dallas last summer, where we had so-called "compe ive" power providers. About the only thing they were competing for was the right to line their wallets with our money.
Texas actually will become the leading state when it comes to amount of generated wind power in the coming year or two, if memory serves.
We might be there already.
Remember any NEW coal plant will have to have a lot more expensive pollution mitigation controls, AND face some delays and problems when it comes to where to put the things and licensing, that won't be as much of a problem with solar.
The costs aren't as markedly different as the article suggests.
That said:
Coal is, at the moment, still cheaper even so, as is a natural gas turbine.
Texas is slated to get a LNG (liquid natural gas) terminal in Houston, so gas will actually be pretty cost compe ive.
Still, having solar around will help mitigate swings in the costs of fuel.
Once the world economy gets back on its feet, you WILL see energy prices go back up, and go back up at a rate that will surprise a lot of people.
There are costs and benefits to each new form of power, and any utility would do well to balance any new construction with a variety of sources.
randomguy u studyin to be an accountant?
i think i should go do me CPA....too lazy to do anything these days....
Precisely.
As I said before, solar produces the most power at exactly the time when the most power is demanded.
Central texas sucks for wind energy anyways.
I am indeed. I am about 4 classes away from my masters, and about 1 class away from being able to sit for the CPA exam.
No rush tho'. Present job doesn't require it.
I have a great interest in renewable power, so it was kinda fun to do a research paper on it for a class. (yes, I got an "A" on it, and the presentation)
these guys are tryin to cut costs, and move to alternative energy which dont create alot of pollution while complying with kyoto protocols.....
wind power/solar > nuclear > coal/gas stations.....all of this can be proceed, only thing such projects are stop; stupid ot green environmentalist groups.
Texas is already #1 in wind generation and it's not even close. I think Texas has about twice the wind generation capacity of the #2 state, California. I've got no problems with wind or solar, I just take issue with a more expensive option being forced upon people during tough economic times.
costs accounting or management accounting i hate that class.....
actually i should do the cpa course, its fkn cheaper than the stupid tertiary degree i paid to do
True, but all the wind energy central Texas gets comes from windfarms out in west Texas. In fact the problem facing wind energy right now is the cost to get the power lines from west Texas to the population markets, not the cost of putting up turbines.
connect it to the power grid....only problem i see is available land and suitable locations to be built on.....farm land sounds reasonable if you pay them leasing costs and they can still produce of the land whatever they are growing/grazing.
i dont think its worth it, reason?
you wont make money now cause ur backyard hydroponic marijuana plants will soon be nationalized by the govt...dont waste that 30k on solar panels
The problem is that you can't just take a bunch of wind turbines and plug them in to any power line. Powerlines are like highways and pipes in that there is a capacity as to how much juice they can carry and since barely anyone lives out in west Texas the capacity is low.
As far as land to put the windmills on goes, hasn't been a problem. Farmers and ranchers love 'em for the very reasons you mention. You just stick a windmill on your land and it just sits there and earns you money.
those wind turbines you can build them on coastline or next to the border of mexico
you seen transformers? they stocked/extracted energy in these halow cubes....
If Austin could only convert pot to energy, they would be set.
You need a masters to take the CPA exam?
bachelor degree then can do cpa/ca program
or bachelor then masters with cpa/ca creditation....
i will just avoid masters...
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