Thursday, November 10, 2011

Debate over carbon emissions, clean energy spur demonstrations in New Mexico

The debate over whether New Mexico should be doing more in pursuit of clean Energy and pollution regulation went beyond the usual flurry of petitions and lawsuits Wednesday when environmentalists showed up at Gov. Susana Martinez's office dressed in solar panel costumes. Singing to the tune of "You are My Sunshine," the activists urged the governor to tap into the state's potential for developing more renewable Energy. The demonstration, the second in as many days, comes as state regulators are taking testimony on whether New Mexico should repeal regulations aimed at curbing greenhouse gas emissions from coal-fired power plants and other large polluters. Critics of the regulations said the debate comes down to a policy question of how much economic pain New Mexico should endure to achieve what they describe as insignificant environmental benefits. Proponents argue the environmental and public health implications of doing nothing could end up costing New Mexico more in the future...more


Paul Lindsey said...

The recently completed 20MW solar PV array at Santa Teresa, NM, with a 12.745 c/kWh PPA to El Paso Electric. That cost is 3 times what EPE pays for "fuel & purchased power" (4.396 c/kWh per my electric bill). Per the PPA, the array has a maximum capacity factor of 25% (43,800 MWh in the 1st yr), a committed c.f. of 17.5% (minimum output of 30,660 MWh in the 1st yr), and an expected output degradation of 0.75%/yr. Furthermore, the notes at the bottom of Exhibit F of the PPA state,

"If the Seller is not awarded the solar Renewable Energy Production Tax Credit, pursuant to NM Statute 7-21-19, the Renewable Energy Payment Rate shall increase by $43.50/MWh" (.435 c/kWh)."


... "If a change in law eliminates the availability of the federal ITC of 30% for solar technology prior to the Required Commercial Operation Date, Seller and EPE shall negotiate in good faith for a price adjustment commensurate with the reduction of tax benefits to the seller, subject to NMPRC approval... and the recovery by EPE of the cost of such adjustment" In other words, the cost will go up and EPE would recover the cost from the consumers.

Why would a utility contract for 20 yrs to pay for power that is 3 times what it pays now? Does EPE expect NG costs to triple over 20 yrs? (the cost of NG is 90% of the cost of generating power at a steam or gas turbine power plant.) The answer is: the NM state Renewable Energy Standard is forcing EPE and PNM to buy inefficient, unreliable solar & wind power, and then pass the costs onto the consumer.

The federal 30% ITC ends Dec 31, 2011. HOORAY, since the Section 1603 grant system awarded money to projects not on their ability to produce power, produce power reliably, or even to produce power in a cost-effective manner, but simply on 30% of the capital costs. When combined with state RES/RPS mandates that explicitly exclude nuclear and hydro, the results are awful for the consumer.

Frank DuBois said...

Paul, thank you for your comments.