Results tagged “renewable energy” from Schwartz MSL Renewablog

Black & Veatch issued its annual electric utility report which surveys the nation's utilities on the top issues facing them in the areas of operational efficiency, profitability and regulatory compliance. The findings of this years report were fascinating on a number of levels, but one major thing stood out to me: the top four issues are definitively linked by a single problem.

According to the survey, reliability, aging infrastructure, environment and long-term investment are the top four issues, in order, on the minds of electric utilities. After reading the survey, I can't help but think that we need to ignore the order in terms of emphasis and focus on the third and fourth issues.

Reliability and aging infrastructure are both significant issues, but symptoms of the lack of long-term investment. Unfortunately, long-term investment is being hampered by the third issue, the environment, due to uncertainty around environmental regulations.

So what's the conclusion? Utilities need long-term regulation that isn't subject to the whims of campaigning politicians and short-term economic cycles in order to drive the type of long-term capital investment that is needed to upgrade its aging infrastructure and fix reliability issues. Period.

There is only one thing that regulated industries hate worse than regulation and that's regulatory uncertainty. Asking utilities to make long-term business decisions and capital investments (for some, the primary mechanism for securing rate increases) when they are unsure what regulatory burden they need to factor into their long-term projections is not fair.

While utilities wonder, for example, whether or not we'll have a price on carbon within the next five years, they are being asked to make long-term decisions on new generation (natural gas, solar, wind, etc), energy efficiency (i.e. smart grid) and other programs that will reduce exposure to carbon. Uncertainty with regards to tax incentives around renewable energy and electric vehicles is also hampering the ability of utilities to plan out new generation capacity that is supposed to provide electricity to its customer base for the next 30 years.

On the consumer side, there is a major lack of awareness and education on the different programs that utilities have put in place. This isn't helped by the fact that nearly half of all utilities have made no attempt to market their smart grid programs according to the survey. That lack of marketing is likely driven by the fact that a lot of the incentives for smart grid rollout and adoption are short term incentives.  

The utility industry members need and want regulatory certainty in order to better run their businesses. Consumers want utilities to offer programs that help them become more efficient. Renewable energy, smart grid and energy efficiency companies want customers incentivised to adopt cleaner technologies.

So isn't the only thing left to do to encourage the federal government and state regulatory bodies to give everyone what they want?

News today that Warren Buffett's MidAmerican Energy Holdings, a Berkshire Hathaway company, has bought its first solar power plant. This is the first time (to my knowledge) a Buffett portfolio company has bought into a renewable energy project. And if the granddaddy of buying undervalued assets was intent on making a BIG splash in his first forray into renewables, he certainly succeeded.

The Topaz Solar Farm is the second largest solar plant in the world among those that are operational or being constructed according to the CNN Money article. This means that Buffett has not only entered the renewables investment game, but has immediately thrust the topic of "solar as an undervalued asset class" to the top of the debate docket within the financial community.

The investment is a major and needed PR boost for a solar industry suffering from Solyndra's high-profile flame out, the anti-dumping complaint filed against Chinese solar manufacturers and uncertainty about the extension of the production tax credit (PTC) and 1603 treasury grants.

This news will remind market watchers that the solar industry is continuing to grow, even with policy uncertainty looming and the high-profile flameouts of a few outlier companies with poor business fundamentals. Bottom line: improvements in technology, project finance and project development could make solar projects one of the best emerging asset classes over the next 5-10 years. Just ask Warren.

One of the biggest changes in renewables over the last decade was the shift in motivation from environmental to economical. Through rapidly decreased costs and major policy changes, solar and wind became a viable alternative and even a strategic economic investment for many businesses and individuals. Economics is still the driving message, but a new and interesting message has emerged:  National Security.

A recent op-ed piece in the New York Times, calling for renewables and energy efficiency for military operations, highlights that a staggering 1,000 troops have been killed in fuel-related missions during the wars in Iraq and Afghanistan. Considering that total deaths in these wars are estimated at less than 6,000, energy security is becoming a key issue to military officials.

For this and other reasons, the military has recently been stressing the importance of energy independence, both domestically and abroad.  The DoD recently launched the Environmental Security Technology Certification Program (ESTCP), to procure and test promising new renewable energy technologies (full disclosure, Schwartz client Skyline Solar was selected). A renewable energy marketer couldn’t ask for a better type of exposure—Military endorsement is a great GR tool, particularly when working with republican officials. Furthermore, these companies now have a chance to build a relationship with the US military – a group with literally the world’s deepest pocketbook.

Outside of the military, Hawaii is another example of security as a benefit to renewables. The state imports nearly all of its fuel resources, which isn’t cheap and certainly isn’t secure. Because of this, Hawaii has become is perhaps the most ambitious of all states, seeking to shift to 70 percent renewable energy for the entire state by 2030. Governor Linda Lingle has sought for quite a while to make energy security part of the conversation. A state making such a huge leap into renewables, and focusing on energy security, is all the more reason marketers should consider adding security to their messaging

Because this conversation is still new, smart marketers will begin discussing energy security early (thought leadership, press release key words, contributed articles) to not only steer the conversation in their favor and build a long-term voice on the subject, but even to build SEO. A Google search of the key words: “Renewable”, “Energy” and “Security”, doesn’t turn up a single vendor on the first page—leaving the window wide-open to those who want to initiate the security conversation.

Fortunately also, the shift in messaging may not be that extreme from what many are already doing. Most of the key words and messages associated with economic benefits (reliability, cost-effectiveness, scalability) remain just as important from a security perspective. A quick project installation time may also be beneficial to stress, for entities looking to interfere with operations as little as possible. Pay back period and ROI, on the other hand, may be less important of a message.

Regardless of how security fits into your company's message, if your product is near-ready or already shipping, the emphasis on energy security should be on your radar for 2011.

Luminus Devices manufactures the biggest LEDs in the world. The company works with many of the largest electronics companies and lighting companies, including Samsung, LG, Acer and Philips VariLite. The company is redefining the solid state lighting market. Their LEDs can last upwards of 50,000 hours (about 25 years of normal use), contain no mercury and use a fraction of the energy used in traditional incandescent light bulbs. The $40 billion lighting industry is going through an epic transformation with innovative companies like Luminus leading the way.  Just one example: typical LEDs emit anywhere from 70-100 lumens per watt while some of Luminus' big chip LEDs provide an output of 20,000 lumens. Wow!!

This amazing story should be seen by everyone, so the Luminus team at Schwartz Communications recently organized a visit to their corporate headquarters in Billerica-MA by 5th Massachusetts Congressional District Congresswoman Niki Tsongas. She met with senior management, toured the manufacturing facility and took questions from employees. This gave the PR team an opportunity to pitch local media outlets and to further educate reporters about the company, its products and how it has created more than 40 new local jobs in 2010. This was the first of what we hope is many steps in educating local and regional elected government officials. To learn more, visit: http://www.luminus.com/contentmgr/showdetails.php/id/1667#1667.

With planning underway for 2011 and Marcom budgets being finalized, now is the time to begin planning a visit by elected officials to your company. Ask yourself some simple questions. First, would your company benefit from government funding in the renewable energy or cleantech markets? If you answer yes then what are you waiting for? Second, reach out to elected officials to confirm a date for them to visit. Prepare a corporate overview with a few simple slides that the CEO can speak to. Then plan a walk-through of the manufacturing plant to give the official a first-hand look at the innovative technology your company is developing. After that, gather employees for an informal Q&A. Close the visit by having a short meeting between just the CEO and the official to discuss jobs and the challenges of manufacturing and employment in the United States. Shoot video of the visit and take many photographs for the company's web site. From start to finish the visit should last 60-90 minutes.

Even better – contact the Schwartz Government Relations Group and let’s talk about it. We do this frequently and we can help you make the most of working with public officials.

There was standing room only as the Renewable Energy Finance Forum (REFF) – London  - Europe’s largest and most established event for renewable energy finance and investment, which celebrated its 12th year anniversary. The highly successful 2-day conference united 400 investors and project developers from over 25 countries.

Lord Browne opened the conference that facilitated thought-provoking, open and highly controversial presentations and discussions on the European global renewables financial market. Other leading speakers included, Hermann Scheer, German MP and Chairman of the World Council for Renewable Energy, Peter Gutman of Standard Chartered Bank, Craig Coborn of BP Alternative Energy and Yvo de Boer, Former Executive Secretary, United Nations Framework Convention on Climate Change & Global Advisor on Climate & Sustainable Development, KPMG.

Over 2 days, speakers composed of almost 70 experts in the renewable energy sector continued the tradition from the last twelve years of bringing together key investors, bankers, developers and renewable energy service providers.

The renewable energy industry has achieved considerable successes here in Europe, which accounted for 44% of all renewable energy deals in 2009, up from 38% in 2008. That being said, the renewable industry is still in the midst of a very challenging period, with the EU Directive mandating 20% renewable energy by 2020 now in full force. Wind remains the most popular renewable and it has been helped along by government incentives as it has gained more than half of the roughly 26 billion invested globally in clean energy in the first quarter of 2010.

As a media sponsor, Schwartz attended the sessions and had a series of interesting conversations on our stand, leading us to take home a few key messages. Firstly, there are some real challenges in funding – the scale of investment needed for infrastructure projects such as the proposed supergrid is far beyond anything ever attempted in the history of mankind! Furthermore, the sector still hasn’t passed the institutional investment threshold – and how can it in the foreseeable future since it seems impossible to accurately calculate risks, and thus ROIs, on long-term windfarms for example.

Another interesting development was the confidence in solar and the belief that grid parity was achievable within the next five to ten years as panel costs come down. Currently, there are concerns about the key Italian and Spanish markets, but there were some positive sentiments about both. Of course the debate regarding feed-in tariffs went around in circles as usual with equally passionate supporters and opponents. However, all agreed that consistency and long term commitments from governments were essential whatever they decide.

With the momentum gained here in London, the conference moves on to San Francisco from September 29 to 30 celebrating its 3rd year of REFF West in the United States.

President Obama "filled in the cracks" on the long-rumored Cash for Caulkers program yesterday as part of a new jobs plan. The latest details have consumers eligible for a $12,000 tax credit if they take steps to weatherize their homes. The goal would be to put contractors back to work and also stimulate the buying of home products aimed at energy efficiency, which would be good news for Home Depot, Lowes, Walmart and others sellers of home improvement materials.

We first heard of the Cash for Caulkers program leading up to the GreenBeat Conference on Smart Grid technologies. John Doerr, a partner at Kleiner Perkins, had suggested the idea to policymakers some time ago.

This caps the third consecutive day of positive news around renewable energy, energy efficiency and climate change, as Obama looks to bolster US credibility on energy use and greenhouse gas emissions. The news coincides with the Cop15 in Copenhagen.

Speaking of energy efficiency, the New York Times reports on a new study that says that focusing on efficiency could reduce energy consumption by 30 percent by 2030, thereby reducing the need for the US to build new power plants. The article reminded me of the fact that renewable energy continues to get the lion's share of media attention, even as people look for cost-effective, pragmatic and near-term ways to cut energy usage in a down economic environment.

That is not to say that renewables get too much attention as they are a critically important part of energy independence and the US economy. But rather that companies with legitimate energy efficiency products need to do a better job marketing the size of the problem they solve and the potential ROI for customers--and the economy at large.