The Business, Technology, and Politics of Green Energy and Alternative Fuels
About this blog
"The business enterprise is a creature of society and an economy, and society or economy can put any business out of existence overnight." - Peter F. Drucker
Green is Good is a blog written by entrepreneur and green capitalist Chris Schultz of Pittsburgh, PA.
Joining Chris is Cara Jette, who blogs under the name Illyrias at PGH is a City and will be keeping us informed about everything green in the city of Pittsburgh.
For my first post on "Green is Good," I wanted to highlight some of the good things that are going on in Pittsburgh. I'm a firm believer that "Green is Good" and that we can spur the economy while saving the planet with the right planning and investment. As a country and a region, we've spent more than enough money investing in projects that are anti-Green. It's time for Green.
Green Innovators. This long-term pet project of Senator Jim Ferlo is set to teach high school graduates to become "green collar" and work in the abundant green projects throughout the region.
That's a healthy list of things to be proud of in the Pittsburgh area. We have a long ways to go (which I'll be sure to point out in future posts) but there's a lot going on here. Anything you're excited about that I missed?
Earlier today Pittsburgh Mayor Luke Ravenstahl announced some of the city's green initiatives, as well as news that the Penguins arena, which will be named after local coal company Consol Energy, will aim for LEED gold certified status. I think this is great news for Pittsburgh which will now have two of the world's largest LEED certified buildings. Let's hope that the city gets back on track to being the leader in green building (I think we are now #7 in the US after being #1 several years back). In order to get back to #1 the city needs to adopt new building codes which will require developments of certain size to achieve at least LEED silver status. Other city's, like Grand Rapids, have seen dramatic results following the passage of green building legislation that requires larger buildings to be energy efficient. Bram posted some video footage of today's announcement, which took place at Market Square.
Earlier today I received an email from the office of Pittsburgh city councilman Bill Peduto announcing an ambitious plan that will reduce Pittsburgh's carbon footprint while saving the city millions in electricity costs. Peduto, who has been the only city legislator to propose green legislation of any sort over the last few years, wants the city to convert all 40,000 of its street lamps to energy efficient LED lighting. The cost of the program will be around $24 million and will be paid using a combination of the annual costs savings and funding from the state's Guaranteed Energy Savings Agreement. Pittsburgh would join cities such as Austin, Raleigh (home LED manufacturer CREE), and Toronto as major cities who have adopted LED lighting on a large scale. According to Peduto, Pittsburgh would be the largest city in the US to roll out a complete conversion to LED lighting. This would be great news for Pittsburgh's green agenda, especially in light of today's Pittsburgh Penguin's press conference, where they announced the 21 year naming rights deal for their new arena, which will be known as the Clean Coal Center.
Over six months ago, Councilman William Peduto launched a trial of LED lights along the Walnut Street business district. Today, he is submitting a proposal for Pittsburgh to replace all 40,000 existing street lights with 200 Watt LED lights.
THE BENEFITS:
1) Green – Financial
Pittsburgh currently spends $3.2 million each year in electricity costs for our street lights. With the reduction of 137W of energy used by each of the 40,000 lights in the City of Pittsburgh, taxpayers will save $1.92 million per year in energy costs.
Pittsburgh currently spends approximately $1 million each year maintaining our street lights. An HPS bulb has 2 - 4 year life span versus 10 - 15 years for an LED light. Additionally, an LED fixtures burns out one LED at a time, which is in contrast to the current lights HPS lights which completely blow out all at once. This is expected to save taxpayers approximately $700,000/year in maintenance costs.
2) Green - Environmental
A 200W LED light only uses 93W of power. However, the existing 150W High Power Sodium (HPS) bulbs use approximately 230W (includes the ballast) of power. Therefore, over the year, the City of Pittsburgh will save 600 kWh of energy. This translates into 984 lbs of carbon dioxide emissions eliminated by switching all lights to LED.
LED lights turn on and off instantly with no warm up time. The existing HPS bulbs have a slow warm up period that is a waste of energy. Additionally, the existing sodium bulbs contain mercury in the ballasts, LED lights have no mercury.
LED lights produce a white light that stimulates the rods and the cones of our eyes. This creates a higher quality white light, while using less energy than the HPS lights that only stimulate the cones of our eyes and produce a yellow-orange light.
THE COST:
Each LED light costs approximately $500 to purchase. Additionally, it would cost about $100 in labor/light in conversion costs. Therefore, the cost to replace 40,000 lights would be approximately $24 million.
PAYING FOR IT:
With a total cost of $24 million and an annual savings of $2,620,000 upon complete conversion, the City can fully payoff the LED conversion in 10.5 years.
Pennsylvania’s Guaranteed Energy Savings Agreement (GESA) can be utilized to cover the upfront costs of the LED conversion. According to the State, “Projects will be implemented where, through simple-payback analysis, cost savings resulting from energy conservation improvements exceed the associated financing. In other words, these guaranteed savings are used to cover operating budget finance payments over a period not to exceed fifteen years.
NEXT STEPS:
The City should issue a Request for Proposals (RFP’s) immediately requesting that all interested companies provide the City with ten test lights to install throughout business districts in the City for a six month trial (February 1, 2009 – July 31, 2009). During the trial period, measurements should be taken to determine the luminous intensity and the energy produced. Solar powered lights and those with photo-sensitive detectors that lessen the light during dusk and dawn should be included in the trial.
The City should award the contract no later than August 31, 2009, based on required conditions of the RFP process, reliability through trial phase, and long term financial and environmental impact. The contract should require work to begin no later than October 1, 2009 and completed by December 31, 2010.
The City should immediately submit an application with the State through the Guaranteed Energy Savings program.
The City should determine programs we can work with to properly dispose of the existing HPS lights. This could be done through the United States Agency for International Development (USAID) or a similar program.
This might be one of Obama's best cabinet selections to date. Dr. Steven Chu is your typical energy secretary, as he is not a politician or energy industry executive. Some had speculated that Pennsylvania Governor Ed Rendell was in the running to be Energy Secretary, and as Bill Richardson's two year tenure as Energy Secretary showed, politicians are the wrong choice as our nation's top energy chief The Wonk Room blog over at Think Progress had a nice write up on the announcement and this paragraph tells why Steven Chu is such an awesome choice as our next energy secretary.
It’s hard to decide if the selection of Dr. Chu is more remarkable for who he is — a Nobel laureate physicist and experienced public-sector administrator — or for who is not. Unlike previous secretaries of energy, he is neither a politician, oil man, military officer, lawyer, nor utility executive. His corporate ties are not to major industrial polluters but to advanced technology corporations like AT&T (where he began his Nobel-winning research) and Silicon Valley innovator Nvidia (where he sits on the board of directors). Chu is a man for the moment, and will be a singular addition to Obama’s Cabinet.
Here is a 9 minute clip of Dr. Chu at the last National Energy Summit. He is wicked smart when it comes to all things energy - he gets climate change, energy efficiency, and clean tech.
"The electrifying redemption of America’s revolutionary declaration that all human beings are born equal sets the stage for the renewal of United States leadership in a world that desperately needs to protect its primary endowment: the integrity and livability of the planet." - Al Gore
If you haven't already read Al Gore's New York Times Op-Ed from the other day titled "The Climate for Change", where the former Vice President shows us his five-part plan that he is recommending to President-Elect Obama and the new Congress. I agree with all five of his recommendations and have followed each of them with my comments, which are in bold.
1. The new president and the new Congress should offer large-scale investment in incentives for the construction of concentrated solar thermal plants in the Southwestern deserts, wind farms in the corridor stretching from Texas to the Dakotas and advanced plants in geothermal hot spots that could produce large amounts of electricity.
This is essentially 1/2 the Pickens plan. Notice how Al Gore is not recommending or pushing natural gas vehicles on us. This is a great first step since we will increase the pace of utility-scale solar plants and wind farms if we want to generate 100% of our electricity from carbon free source in 20 or 30 years, let alone the 10 years that Al Gore wants us to shoot for. Vice President Gore does not mention Nuclear Power but I agree with Obama's position which is that Nuclear should be part of the mix as long as we implement safe and secure procedures for storing spent fuel.
2. We should begin the planning and construction of a unified national smart grid for the transport of renewable electricity from the rural places where it is mostly generated to the cities where it is mostly used. New high-voltage, low-loss underground lines can be designed with “smart” features that provide consumers with sophisticated information and easy-to-use tools for conserving electricity, eliminating inefficiency and reducing their energy bills. The cost of this modern grid — $400 billion over 10 years — pales in comparison with the annual loss to American business of $120 billion due to the cascading failures that are endemic to our current balkanized and antiquated electricity lines.
Do you know how often our power is out for hours due to your standard thunderstorm? Far too often, and it is due to the updated and dumb electricity grid that spans every corner of our nation. If we are going to invest trillions in new 21st century electricity generation we need a 21st century grid that will deliver that electricity to our door steps and to our electric vehicles, which, if powered by clean electricity, will be the solution that kicks our oil dependency habit.
3. We should help America’s automobile industry (not only the Big Three but the innovative new startup companies as well) to convert quickly to plug-in hybrids that can run on the renewable electricity that will be available as the rest of this plan matures. In combination with the unified grid, a nationwide fleet of plug-in hybrids would also help to solve the problem of electricity storage. Think about it: with this sort of grid, cars could be charged during off-peak energy-use hours; during peak hours, when fewer cars are on the road, they could contribute their electricity back into the national grid.
Well, any bailout is going to be controversial, but I have to agree with both Al Gore and Tom Friedman, who in his column today, wrote that while we should not give the automakers a blank check but we should consider giving them a bailout with strings attached - as long as those strings insist on the automakers transforming their vehicle fleets to become hybrid electrics:
I would add other conditions: Any car company that gets taxpayer money must demonstrate a plan for transforming every vehicle in its fleet to a hybrid-electric engine with flex-fuel capability, so its entire fleet can also run on next generation cellulosic ethanol.
4. We should embark on a nationwide effort to retrofit buildings with better insulation and energy-efficient windows and lighting. Approximately 40 percent of carbon dioxide emissions in the United States come from buildings — and stopping that pollution saves money for homeowners and businesses. This initiative should be coupled with the proposal in Congress to help Americans who are burdened by mortgages that exceed the value of their homes.
Can we start with Pittsburgh's City County building at 414 Grant Street? It has to be the least energy efficient government buildings in all the land. The effort to retrofit buildings should start with schools and public buildings, and then the federal government should leave it to the individual utilities to manage this program, which will work as long as the utilities are given incentives to reduce their average customer's electricity consumption. California has been doing this for a while now and despite having a growing population and expanding economy over the last twenty years their per capita energy usage has remained flat.
5. The United States should lead the way by putting a price on carbon here at home, and by leading the world’s efforts to replace the Kyoto treaty next year in Copenhagen with a more effective treaty that caps global carbon dioxide emissions and encourages nations to invest together in efficient ways to reduce global warming pollution quickly, including by sharply reducing deforestation.
Do we implement a carbon tax or do we implement a cap and trade system? I've seen good arguments for both sides, and I'm not sure where I stand on the issue since either one would be difficult to achieve politically, not to mention the costs that would be passed on to consumers would be too burdensome on many citizens who are already struggling in today's economy.
One policy initiative that I am in favor of that would fall under a carbon tax is a feebate on vehicle purchases. I don't consider myself to be a libertarian, but I do think individuals should have the freedom to purchase big gas guzzlers - as long as they are adequately paying for the full cost of doing so. That full cost would come to fruition if there was a fee charged to consumers on all purchases of vehicles that are consider gas guzzlers. On the flip side, consumers who choose to purchase fuel efficient vehicles and hybrid or plug-in electric vehicles should be rewarded with incentives such as rebates. This proposal is gaining steam in some states and I expect it to get some consideration at the federal level.
Finally, after almost a year and a half of wrangling over a 40 cent a month tax, the majority of Governor Ed Rendell's legislation for Energy Independence was finally approved by the state Senate during the 2009 budget negotiations. The new legislation, , which originally was for $850 million, will consist of $650 million in spending on a number of clean energy and energy conservation initiatives with the biggest chunk - $180 million, going towards solar power programs for residences and businesses ($100m) and capital investment ($80m) to lure new solar power manufacturers to the commonwealth. This is great news for Pennsylvania and, despite not getting the full $850 miillion, it is a big win for Ed Rendell, who may have his eye on the Secretary of Energy position. It is also a big win for DEP Secretary Katy McGinty, whom I feel should make a run for Governor in 2010. Both the TRIB and PG have more on this great news.
I couldn't believe my ears last week, when I, for a change, tuned to 104.7 FM's Quinn and Rose morning talk show. Quinn and Rose are your typical polarizing talk show hosts who happen to think they're right 100% and the other side is always wrong 100% of the time.
It should be no surprise to my readers when I say that on environmental and climate change issues the Democratic Party candidates seem to get it more than the Republican candidates. So, being conservative talk show hosts, Quinn and his co-host, Rose, started going off on the Energy Bill, particularly on how it supposedly eliminate incandescent light bulbs from the marketplace. They, not surprisingly, during their rant slammed global warming, climate change, and Al Gore. Typical conservative talking points, right?
But then it got amusing, and sad, at the same time.
"How could Bush sign this bill?" whined Rose. "You know who is going to profit from this? The Phillips company. Is Bush in bed with the Phillips family or something. I don't understand how he could do such a thing. What was he thinking?!" Then she went on to talk about how women need the bright white light of incandescents when putting on make-up, and how she was going to stock up on hundreds of incandescent light bulbs because in the future she would have lamps with no compatible light bulbs, which means she would then have to turn to the black market.
I found her ignorance laughable, because, the Energy Bill is not eliminating incandescent light bulbs. The Energy Bill is mandating that all light bulbs starting with the 100 watt bulbs in 2012 must consume from 25 to 30% less electricity. The phased in mandate for more energy efficient light bulbs continues through 2014 when 40 watt bulbs must meet the new energy efficient ratings, and then finally, in 2020, all light bulbs must be 70% more efficient than today's light bulbs. So, I do not expect incandescents to go away entirely because companies are already improving the technology which has been around for roughly 100 years. Competing technologies, like Compact Fluorescents (CFLs) and LEDs are becoming cheaper, longer lasting, and more effective at offering light that competes with the best of the incandescents bulbs.
In Rose's defense, how was she supposed to know the truth about the Energy Bill? How do our citizens and concerned radio show hosts learn and then communicate the nuts and bolts of our federal legislation if they do not have access to the information in a way where they, in this age of text messaging and ADD, can consume, comprehend, and analyze the key points of legislation such as the latest Energy Bill. I do not know of such a system where that information is at my fingertips.
I am hoping that the next time legislation as important as the Energy Bill is up for vote, the average person who does not follow the issues as closely as your or I can simply go to a website and see what is going on, without the bias or construing of the facts that we see on talk shows or talk radio. Then, before their Representative in Congress votes on the Bill, the citizen could communicate with them to discuss their concerns and hopefully get their questions answered in a timely fashion.
If we do not know the issues and stakes at hand, then our Representatives do not know of our concerns. So how can we influence them to vote a certain way? Said another way, absent of this dialog with our Government - we will continue to see legislation that is influenced by the lobbies and corporate interests who have the time and money to get in front of the members of Congress.
We need a more democratic information system in place than what we have today. There are a number of websites that do a good job of tracking votes, campaign donations, and legislation but there needs to be more - a one stop shop that informs citizens and encourages their participation in the legislative process.
