RWEI 2011 - Mid-Atlantic Renewable Energy

Mid-Atlantic Renewable Energy Coalition: 

Mid-Atlantic Renewable Energy Coalition 2011 RWEI Annual Meeting October 26, 2011 1

Members of MAREC: 

Members of MAREC Wind Developers, Turbine Manufacturers and Transmission Companies: AES BP Clean Line Energy Partners EverPower Wind Gamesa GE Energy Horizon Wind Iberdrola Renewables Invenergy Vestas Public Interest Organizations: PennFuture American Wind Energy Association (AWEA) 2

MAREC’s Policy Objectives : 

MAREC’s Policy Objectives Grow wind and other renewables. Work with state regulators to develop rules and supportive policies for renewable energy. Promote improvement to electric transmission infrastructure to facilitate renewable development. Provide education on environmental sustainability and renewable energy. Provide technical expertise and education on integrating variable wind energy resources to the electric grid. 3

AWEA’s Regional Partners: 

AWEA’s Regional Partners Data Sources: AWEA , U.S. DOE 20% Wind Energy by 2030

MAREC’s Footprint: 

MAREC’s Footprint Delaware District of Columbia Maryland New Jersey North Carolina Ohio Pennsylvania Virginia West Virginia 5

MAREC’s Activities: 

MAREC’s Activities Participates in PJM task f orce, subcommittee and committee meetings. Intervenes in state regulatory proceedings. Conducts outreach to policymakers, the public and the media. Works with AWEA and regional partners on regional and national plans. Prepares and files supporting documents in matters before FERC and other federal agencies. Participates in conferences and other key wind energy events. Conducts member outreach and recruitment. 6

U.S. Wind Facts: 

U.S. Wind Facts 29 states and the District of Columbia have renewable electricity/portfolio standards (RES or RPS ). 8 states have goals. Over 5,000 MW of wind added in 2010 Total installed wind capacity in the U.S. is over 40,000 MW 5,600 MW under construction at start of 2011. Wind industry supported 85,000 jobs in 2010. Source: AWEA U.S. Wind Industry Market Reports – Fourth Quarter 2010 7

Wind Development in Selected States: 

Wind Development in Selected States Wind Energy Installed Capacity by State in MW 1999 2005 2011 MW in Queue CA 1,616 2,149 3,179 18,269 ME < 1 < 1 266 1,398 MD 0 0 120 390 NJ 0 8 8 1,416 NY 0 186 1,349 8,000 ND < 1 98 1,424 11,493 OH 0 7 67 3,683 PA < 1 129 751 3,391 TX 183.5 1,992 10,135 63,504 WV 0 66 431 1,045 Source : DOE Wind Powering America, AWEA and PJM Webpages 8

Installed Wind Capacity by State Current Rankings: 

Installed Wind Capacity by State Current Rankings (1) Texas 10,135 MW (2) Iowa 3,675 MW (3) California 3,179 MW (4) Minnesota 2,485 MW (5) Washington 2,357 MW (6 ) Illinois 2,286 MW ( 15) Pennsylvania 751 MW (20) West Virginia 431 MW American Wind Energy Association - State Fact Sheets 9

Selected MAREC State Renewable Portfolio Standards: 

Selected MAREC State Renewable Portfolio Standards End Date Tier/Class I Solar C/O Tier/Class II MD 2022 20% 2.0% 2.5%* NJ 2021 17.88% 5,316 GWh 2.5% NC 2021 12.5% 0.20** n/a PA CY 2020-2021 8% 0.5% 10% VA*** 2025 15% n/a n/a WV**** 2025 25% n/a n/a * Tier II compliance ends in 2018 ** By 2018, 0.20% carve-out for swine waste and 900,000 MWh from poultry waste *** Voluntary RPS **** Alternative and Renewable Energy Portfolio Standard 10

Maryland Wind Power: 

Maryland Wind Power 20% (Tier I) mandatory RPS by 2022; 2% solar carve out. 120 MW installed at this time. Legislation (HB 1054) being considered that would require 400-600 MW of offshore wind. The legislation was tabled and will be considered in 2012. Maryland has almost 1500 MW of onshore wind capacity available . MAREC intervened in Exelon/Constellation merger case before the Maryland Public Service Commission. 11

North Carolina Wind Power: 

North Carolina Wind Power 12.5% mandatory RPS by 2021. 0.2% from swine waste and 900,000 MWh from poultry waste by 2018. 824 MW of wind generation in the PJM queue. Senate Bill 747 introduced in April 2011 would require North Carolina electric utilities to enter into long-term contracts for 2500 MW of offshore wind energy. 12

Virginia Wind Power: 

Virginia Wind Power 15% voluntary RPS by 2025. VA State Corporation Commission (SCC) could provide 50 basis point adder to an electric utility’s rate of return that meets the voluntary target. APCO long-term wind purchase power agreements (PPA) denied for cost recovery by the SCC. VA in the hunt for offshore wind. 500 MW project to be located 20 miles off the coast of Virginia Beach listed in PJM queue . 2010 Legislation – The Virginia Offshore Wind Development Authority was created to facilitate the development of the offshore wind energy industry. 13

West Virginia Wind Power: 

West Virginia Wind Power 25% mandatory per the Alternative and Renewable Energy Portfolio Standard (AREPS). 2X credit for Renewable technologies . Public Service Commission of West Virginia completed rulemaking in 2010 to implement statutory requirements of the AREPS . 431 MW of installed capacity. Over 1000 MW in the PJM queue. Commission has approved several long-term wind PPAs. 14

Long-Term Purchase Power Agreements: 

Long-Term Purchase Power Agreements 10-25 year PPAs are needed to secure financing for many projects. Risk is on the wind energy developer. PPAs should be prudently entered into by electric utilities: cost effective and reasonable procurement process. Approved PPAs should allow for cost recovery by the acquiring utility. 15

Transmission Infrastructure: 

Transmission Infrastructure The transmission system in the U.S. is underbuilt. According to the AWEA, nearly 300,000 MW of wind capacity (an amount equal to 20% of U.S. generation) is being held up due to transmission system limitations . DOE/NREL report finds that 20% to 30% penetration of wind into the Eastern Interconnection by 2024 is “technically feasible .” PJM is studying how it might consider state policy initiatives (renewables) in its transmission planning process. FERC Order 1000. 16

Why Wind?: 

Why Wind? Enhance energy security by diversifying the electric generation portfolio. Boost economic development in the areas where wind resources are developed. Improve the environment by developing technologies, like wind, that are zero polluting and carbon-emitting. Satisfy state policy initiatives, like RPS mandates and goals. Wind energy has provided prices that are competitive with other new generation options. 17

Lazard June 2011: 

Lazard June 2011 Levelized Cost of Energy Comparison 18

Wind Energy Impacts on Market Prices: 

Wind Energy Impacts on Market Prices 2009 PJM study : “15,000 MW of wind offers wholesale market price reductions of $4.50-6/ MWh , translating to reductions in annual market-wide expenditures of $3.55 billion to $4.74 billion versus not having that wind in place .” Potential Effects of Proposed Climate Change Policies on PJM’s Energy Market; January 23,2009 2009 Bernstein Research analysis: “ found that wind generation has materially reduced the marginal cost of supply of electricity generation, by $2–$ 4/ MWh for the four regions with the largest installed wind capacity (i.e ., ERCOT , MISO, SSP and PJM West), mostly by displacing higher-cost coal and gas-fired generators .” US Wind Power Spins into High Gear; November 2009 19

Local Economic Impacts of Wind Farm: 

Local Economic Impacts of Wind Farm Duration 10 Months Project Size 100 MW Turbine Size GE 1.5 MW Number of Turbines 67 Labor Costs: 179 Jobs $12,400,000 Aggregate, Concrete & Rebar $ 4,500,000 Road Contract , OM Building, Misc . $ 7,000,000 Local Construction Total $23,900,000 Local Taxes Varies Lease Payments Varies 20

Turbine Foundation Work: 

Turbine Foundation Work 21

Foundation Nearly Complete: 

Foundation Nearly Complete 22

Mid-Atlantic Renewable Energy Coalition: 

Mid-Atlantic Renewable Energy Coalition Bruce Burcat Executive Director (302) 331-4639 bburcat@marec.us 23

Questions?: 

Questions? 24