Energy in the News: Will Austin Pay Taxes on Biomass Plant?

Photo by Warren Getz, NREL

Austin Energy’s purchase of power plant threatens Nacogdoches County

By Philip Jankowski, Austin American Statesman

May 4, 2019 at 6:29 PM

When Austin Energy announced it would purchase an East Texas biomass power plant, executives at the utility projected the $460 million purchase would save the city hundreds of millions.

What Austin Energy didn’t mention was the collateral damage the acquisition could have on the poverty stricken rural East Texas school district, the small emergency services district and the county that have come to rely on the property tax revenue the facility generates.

Paul Robbins, an environmental activist and sometimes critic of Austin Energy, said …

“The humane part of me wants to say, ‘Well, sure.’ But the business part of me says, ‘We bit this bullet in order to get out of an onerous contract. When will this ever end?’”

Energy in the News: Austin Buys Biomass Plant

Austin Energy: Safeguards in place after paying $460M for plant that lost value over the years

KXAN, April 23, 2019

Austin Energy is paying hundreds of millions of dollars to get out of a $2 billion energy contract it entered into back in 2012.  City leaders say they are saving customers money.  But critics say it was a bad deal in the first place.

The City now owns this wood-burning plant in Nacogdoches rather than leasing energy from it like it did before.

Environmental activist Paul Robbins tells me the purchase is the end of a more than $2 billion, long-term mistake.

Paul Robbins: I compared benchmark costs of what a biomass plant should have cost compared to what we were being charged.  The cost difference was stark. It made no sense.

 

Energy in the News: Leading the next wave of renewable energy

Robbins: Austin should lead the way for next wave of renewable energy

Paul Robbins – Special to the Austin American-Statesman, Sunday, May 13, 2018

Wind power and solar cells may seem like best friends to environmentalists, but in a very real sense, they are “fair weather friends.”

Most Austinites remember waking up to the bitterly cold morning of Jan. 17, when temperatures plummeted to 18 degrees. Austin’s utility hit a new winter demand record. When this occurred, Austin’s wind power operated at only 22 percent of its rated capacity, and its solar cells operated at only 1.5 percent of capacity.

Defenders of fossil fuels never fail to fault wind and solar cells as intermittent and not “dispatchable,” that is, these power sources cannot be turned on or off on demand. The many cities, states and countries trying to increase consumption of renewable energy confront this problem.

The city of Georgetown, just north of Austin, purchases 100 percent of its electricity from wind and solar cells. But it can only do this on paper. Its dispatchable balancing power came from the Texas grid known as ERCOT, operated by the Electric Reliability Council of Texas. In 2017, ERCOT received only 18 percent of its electricity from wind and solar.

RELATED: How Georgetown’s GOP mayor became a hero to climate change evangelists

Denmark, a clean energy champion, got 46 percent of its electricity from wind and solar cells in 2017. But the tiny country trades electricity every minute of the year with its neighbors in Germany, Norway and Sweden. The region collectively generates only 18 percent of its electricity from intermittent renewable power.

Some academics suggest that intermittent wind and solar can be woven together from different regions to form virtual dispatchability, with little or no conventional power needed. When one region is not producing power, another will. However, there is no place in the world where this has been done at scale. Even if it could be done, long distance transmission lines are expensive.

Some clean energy advocates believe electric batteries will create dispatchability. But at this point in time, they are not economic for daily storage in the mainstream United States. They are only economic for niche markets.

Austin has been a leader in clean energy for decades. We need to take the next step and develop dispatchable renewable options available for Texas.

Concentrating Solar Power, which has existed since the 1980s, uses mirrors or lenses to focus high-temperature heat to the top of a tower or the center of a trough to boil water or refrigerant to generate electricity. Just six-tenths of 1 percent of the land in Texas could provide all of its total 2017 electric consumption. Its onsite heat storage is relatively inexpensive compared to electric batteries.

ALSO READ: Austin’s energy goals laudable but counter to laws of physics

Compressed Air Energy Storage uses intermittent or low-cost power to produce compressed air in geologic formations like old gas wells. When stored energy is needed, the air is heated in a combustion turbine, which operates at greater efficiency due to increased pressure. This process still needs natural gas, albeit greatly reduced amounts of it. In the future, waste heat from the compression process itself might replace gas altogether.

Thermal Energy Storage uses intermittent or low-cost power to produce ice, cold water, or hot water in tanks inside or near buildings for later use. It is cost effective today for many large buildings and grocery stores. Austin has barely scratched the surface of its potential.

Concentrating Solar Power and Compressed Air Energy Storage have not been built in Texas. The first plants will be more expensive because they have not reached economies of scale. To mitigate costs, Austin should become the charter member of a partnership with other Texas cities and utilities to share the expense. Austin could also use funding from the utility’s GreenChoice program, which allows customers to voluntarily pay more to support renewable energy.

Thermal Storage could be mandated and incentivized for new large buildings and grocery stores when appropriate.

Real leaders in clean energy today are confronting dispatchability. If Austin wants to continue to lead in this field, we need to rise to this challenge.

Robbins is an environmental activist, consumer advocate, and editor of the Austin Environmental Directory .

 

Presentation on Dispatchable Renewable Energy

Solar cell and wind generation are great for the environment, but they are limited in their reach.  They are intermittent, and cannot be dispatched on demand when they are needed.

On April 17, 2018, a presentation (now recorded) was made to the City of Austin’s Resource Management Commission on the need for dispatchable renewable generation as well as solar cells and wind.

View it at this link.

One of my ideas is to convert GreenChoice from funding wind to funding Concentrating Solar Power.  Wind is now close to parity with conventional fuel charges in Austin, and converting GC to solar could allow Austin to start buying dispatchable renewables at little or no cost to the typical Austin consumer.

Energy in the News: 100% Clean Energy in the Real World

Clashing Over How to Boost Clean Energy
Jack Craver, Reporter, Energy Industry, Energy Central             Posted on April 9, 2018

Paul Robbins has become something of an institution in Austin as a full-time, volunteer watchdog of the city’s municipally-owned utility, Austin Energy. Recently I wrote about how he forced AE to make changes to its discount program for low-income customers. This week I’d like to focus on another fight he has waged, often putting him at odds with fellow environmentalists.

Robbins, who calls himself an “environmental and consumer advocate,” got engaged in politics in the 1970’s as part of the anti-nuclear movement. But he scoffs at the demands made of Austin Energy by many of the city’s environmentalists, saying that their campaign for 100% renewable energy in the near future is unrealistic.

…So what Robbins suggest? He wants AE to start seriously considering ways to ramp up dispatchable renewable power.

Energy in the News: Austin’s energy goals laudable but counter to laws of physics

Robbins: Austin’s energy goals laudable but counter to laws of physics

By Paul Robbins – Special to the American-Statesman, Posted: 1:46 p.m. Thursday, Sept. 4, 2014

Scientists and policymakers who study global warming are understandably panicked by the deterioration of the earth’s climate. Rising temperatures, increasing drought ironically contrasted with increased incidents of major floods, reduced agricultural output, and dying forests are all predicted as the damage spreads. In worst-case scenarios, billions of people could be at risk of a reduced quality of life, or much worse.

Many activists are desperate for action to eliminate fossil fuel use associated with carbon emissions. I share their frustration. Unfortunately, desperation does not breed good policy, and you cannot legislate physics.

An unfortunate attempt at such legislation occurred at the Aug. 28 City Council meeting, where advocates for clean energy won a commitment for 100 percent carbon-free electricity for Austin’s municipal utility by 2030 (assuming it is “affordable”). Currently Austin gets 23 percent of its energy from renewables.

As an advocate of clean energy for 37 years, it pains me to question this laudable goal, but without cost-effective energy storage, I do not see a way to technically achieve it.

Some people believe that Austin should retire or sell off its fossil assets and only buy renewable power. This scenario would have the Texas electric grid (ERCOT) sell Austin all the capacity to balance these intermittent power sources.

The problem with the theory is that Austinites may have to pay dearly for their idealism. Privately owned “merchant” plants can charge what the market will bear. Wealth would likely be sucked out of Austin, wealth that could go toward the purchase of clean energy equipment in homes and commercial buildings, among other things.

Also, the “affordability goal” for Austin Energy exempts fuel, so most renewable energy contracts will be loopholed since they are paid for in the fuel charge.

The essence of the carbon-free resolution came from a report issued by the council-appointed Generation Task Force. I invite anyone interested in Austin’s future to read this report. It is largely undocumented and has numerous flaws and contradictions.

  • In one place, the report advocates careful estimation of natural gas prices to ensure that a new gas generator is economic, while in another it advocates complete elimination of fossil fuel.
  • The report does not define if nuclear energy is carbon free.
  • The report has arbitrary or undocumented goals for increased energy efficiency, energy storage and solar energy.
  • Even if these arbitrary and undocumented goals are carried out, they are so small that they will not even compensate for the utility’s average growth rate, much less the fossil fuel we currently use.
  • Its section promoting more assistance to low-income customers is so flawed that it defines a household making over $95,000 per year as “working poor.”
  • The report’s obsession with solar energy from West Texas ignores the use of wind from the Texas coast, which is currently less expensive and generates considerable power during summer peak demand.

Fellow environmentalists have questioned why I would be so ardent opposing this supposedly benign resolution and in questioning the Task Force Report. It is because if clean energy supporters are to maintain credibility with the public, we need to explain the costs, benefits, and the current and future capabilities of the technologies as well as the environmental consequences of the current system.

For the next phase of Austin’s clean energy development, programs rather than arbitrary goals should be the norm. My own short list:

  • Create a storage “partnership” with other Texas utilities to develop various technologies while defraying some or most of the economic risk;
  • Create an “on-bill financing” program, similar to what has been done in four other states, to finance clean energy on customers’ electric bills instead of financing new power plants;
  • Since the current Generation Task Force is not inclined to continue to refine its report, appoint a sequel that will come up with a real energy plan for Austin’s future.

Robbins lives in Austin and has been an environmental activist for 37 years.

Energy in the News: Austin’s Biomass Plant Commissioned

Renewable energy advocates have a responsibility to the public to see that their money is well spent.   At the time the contract for a power purchase agreement was approved by City Council in 2008, most environmentalists that spoke were either critical of the plant, or said they did not have enough information to support it.

We gained credibility with the public because of this.

Unfortunately, our opinion did not prevail, and we will be paying for this millstone until 2032 barring some change in the contract.

At a small ceremony amid the tall pines of East Texas, a handful of Austin officials watched one of the most unpopular investments in Austin Energy’s history rumble to life Wednesday.

A power plant fueled by wood waste held its official opening after briefly coming online a few weeks ago. The privately owned plant will sell $2 billion worth of electricity to Austin Energy for the next 20 years at a price well above the going rate for competing power sources.

“As a green-power advocate, I think we would have been better off investing in other things,” environmental activist Paul Robbins said.

Energy in the News: Austin becomes an all-green municipal operation

This article announced that the City of Austin’s annual municipal electricity purchases would all be from GreenChoice renewable energy.  This was about 328 million kilowatt hours a year in 2017.  Though the electricity coming through the lines was a mix of all power sources, this mechanism allowed Austin to dedicate its electric budget to wind power, allowing more demand  to be sold on the system.

Costs premiums of about $8.5 million detailed in this story have since come down markedly, in part due to my intervention.

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Today, Austin becomes an all-green municipal operation

Today Austin will become the nation’s first major green-energy-only municipal operation, a milestone it will reach by relying on renewable energy the city has been unable to sell to its 400,000 other electric customers.

…every penny the city would normally spend on nonrenewable sources will instead go to a West Texas wind farm. This will reduce the carbon footprint of one of Central Texas’ biggest carbon-producing enterprises.

“Austin calls itself a green city. A lot of that is hype,” said environmental activist Paul Robbins, who has been pushing the city to switch to renewable energy for more than a decade. Now that it has, he said, “This is the first time in a long time Austin is truly a leader.”