British Government & Giant USA Utilities Announce Feed-In-Tariffs For Clean Enegy Development

Two momentous events in the evolution of policy for a new energy economy for the planet occurred in late November 2008.

The Los Angeles Department of Water & Power, the largest municipal utility district in North America, announced on November 24, 2008 that it is prepared to launch one of the continent's largest solar power programs, also making use of a feed-in tariff by 2016. Los Angeles joins Gainesville Regional Utilities in Florida, Toronto Hydro (Canada's largest municipal utility, and second largest to LAWPD in North America), and a few other smaller cities in using FITs as a centerpiece for encouraging rapid clean energy development.

"Regardless of how or even whether it follows through, Los Angeles, as one of North America's largest cities, has put feed-in tariffs, at least for solar, on the continent's public policy map."

Two days later, The British Government on November 26, 2008 approved its Energy Bill that includes implementing a system of feed-in tariffs (FITs) for small renewable energy producers by 2010. The feed-in tariff provisions until recently were unthinkable in the British political landscape.

"The move by the British government has far reaching ramifications. The English speaking world has been more resistant to feed-in tariffs than non-English speaking countries, sometimes on ideological grounds, sometimes simply out of ignorance. Many North Americans, for example, attribute continental Europe's success with renewable energy to renewable portfolio standards, which is not the case.
 Now that the British have clearly moved toward the camp favoring feed-in tariffs, there may be less reticence to do so elsewhere in the Anglophone world."

See full details in the second article below, and note that FITs are the basis for accelerated clean energy development in Germany, Spain, France, and Denmark, for example.

For a primer on FITs, see the easily readable and well illustrated 16-page 2008 report from the World Future Council: "Feed-In Tariffs -- Boosting Energy for our Future: A guide to one of the world's best environmental policies," by the World Future Council, 2008

It looks like a very promising 2009 awaits us in moving rapidly from a obsolescent fossil fuel/dirty energy economy to a modern clean energy economy.


Renewable Energy World/Los Angeles Department of Water & Power

December 3, 2008

North America's Largest Municipal Utility Proposes Solar Feed-in Tariff

by Paul Gipe, Contributing Writer

Los Angeles, United States [RenewableEnergyWorld.com]

Los Angeles Mayor Antonio Villaraigosa announced to much fanfare on November 24 that the city's municipal utility would launch one of the continent's largest solar power programs. The mayor's plan would direct the city's municipal utility, the Los Angeles Department of Water and Power (LADWP), to build or purchase 1,300 MW of solar energy by 2020.

Among provisions of the plan is a feed-in tariff for 150 MW of solar photovoltaics by 2016. This is the first official announcement of a feed-in tariff proposal by a California city, but it is not the first in the United States. Gainesville, Florida previously announced that it was formally considering a feed-in tariff to replace its solar rebate program.

Recently, the Palm Springs Desert Sun reported that Palm Desert, California was also considering solar feed-in tariffs after city officials toured Spain, one of the world's leading developers of solar energy. Spain uses feed-in tariffs.

LADWP is the continent's largest municipal utility. It was briefly at the forefront of solar energy development in California from 1999 to 2003, before inexplicably abandoning its program.

The city and LADWP provided no details on the solar feed-in tariff or on the other renewable energy proposals that were part of the mayor's press release. There were no further details on LADWP's web site. Photos of wind turbines on the web site were standard stock photos and all were of wind turbines outside the utility's service area.

LADWP claims that 8.5% of its electricity currently comes from renewables and that the utility is on track to meet its 20% target by 2010. The last report on the utility's web site about its renewable energy program, however, is dated 2003, the year the utility canceled its successful solar program.

Los Angeles' 120 MW Pine Tree wind project is slated to come on line in 2009. The project also is outside of the Los Angeles Basin, just north of the Tehachapi Wind Resource Area.

Interestingly, it was a municipal utility that launched the modern version of Germany's famed feed-in tariffs. Aachen introduced the first solar-specific feed-in tariff in the mid-1990s. Subsequently other German cities followed suit. In 2000 Germany's parliament incorporated the concept behind Aachen's policy in its groundbreaking system of Advanced Renewable Tariffs.

Municipal utilities in the Americas may be able to emulate Aachen and be the first to launch true feed-in tariffs. Because municipal utilities are governed by city officials, they can be more responsive to public demands for action on renewable energy than the often more distant state or provincial legislatures.

Toronto Hydro, North America's second largest and Canada's largest municipal utility, briefly considered a solar PV feed-in tariff in 2007, but took no action. The proposal before Toronto Hydro employed a differentiated feed-in tariff that was intended to work with the province of Ontario's Standard Offer Contract Program.

The proposal of Gainesville Regional Utilities (GRU) is the most advanced in the United States.
GRU's commission has ordered preparation of a tariff.


In contrast to Gainesville's approach, LADWP made public little or no information on the details of its proposal. GRU prepared a detailed report which it presented to Gainesville's utility commission when the utility went public with its proposal.

Los Angeles incorporates Hollywood within its city boundaries and there's always an element of showmanship in its pronouncements. The city's proposal is aggressive, more than one-third of the California Solar Initiative's 3,000 MW of solar PV, if it is more than simply aspirational.



The portion of the plan devoted to a feed-in tariff is about one-tenth of the entire program. Countries that have been the most successful at rapidly developing renewable energy (Germany, France, and Spain) use feed-in tariffs as the principal if not only policy mechanism.

Despite the uncritical media accounts of the "world's most ambitious solar plan," attention has focused not only on the targets, but also on the various mechanisms that may be used to reach those targets, including feed-in tariffs.

Regardless of how or even whether it follows through, Los Angeles, as one of North America's largest cities, has put feed-in tariffs, at least for solar, on the continent's public policy map.


Renewable Energy World/Britain’s Energy Bill

December 1, 2008

British Feed-in Tariff Policy Becomes Law - Was Once Unthinkable

by Paul Gipe, Contributing Writer

London, UK [RenewableEnergyWorld.com]

The Queen gave her "royal assent" to Britain's long-debated Energy Bill on November 26, 2008, putting into law Britain's commitment to dramatically cut its greenhouse gas emissions. The Energy Bill also contained provisions calling on Gordon Brown's Labour government to implement a system of feed-in tariffs for small renewable energy producers by 2010.

The feed-in tariff provisions were once unthinkable in the British political landscape. They said it "couldn't be done" is how British campaigners described the remarkable success.



Since Margaret Thatcher, Britain has relied on a series of call for tenders and eventually a complex quota system to build a modest wind energy industry dominated by the word's largest electric utilities. There was little more than token support for small-scale renewables through traditional subsidy programs under successive Conservative and Labour governments.



Meanwhile on the continent, renewables were booming, first in Denmark, then in Germany, France, and Spain through the use of innovative systems of feed-in tariffs. These systems of Advanced Renewable Tariffs spurred growth of a variety of renewable energy technologies at all scales. In Germany, a large percentage of solar and wind energy are being developed by homeowners, farmers, and small investors.



The feed-in tariff provisions of Britain's Energy Bill are modest in comparison to those in other countries. In contrast to continental European policies, projects are limited to no more than 5 MW. There are no project size limits in Germany, for example. Nor does the Energy Bill contain the specific provisions or prices that are part of such acts in France and Germany. Specific provisions will be determined administratively in 2009.

The Energy Bill leaves in place Britain's existing Renewable Obligation Certificate trading program for larger projects. The two programs, the Renewable Obligation and the feed-in tariff system, will operate in parallel.



There was cross party agreement on amendments to the bill that included the essential elements of any successful feed-in tariff policy. For example, there was an amendment that called for different tariffs for different renewable energy technologies a key feature of the policies in Germany, France, and Spain. The cross party agreement included both the Conservatives and the Liberal Democrats.



The campaign for the Energy Bill was led by Friends of the Earth UK (FOE) and Britain's Renewable Energy Association.

According to FOE campaigner David Timm, the Labour government now appears committed to introducing a true system of feed-in tariffs by the end of 2010.



Alan Simpson, Labour MP, led debate in the House of Commons, taking issue not only with expected opposition to feed-in tariffs from electric utilities but also from the renewable energy industry itself.

"On the record, many of the big energy suppliers have been fighting tooth and claw to prevent us from doing anything as bold and imaginative as we are doing. The Association of Electricity Producers had lobbied for a threshold of 50 kW. The British Wind Energy Association lobbied, until the last moment, for a threshold of 500 kW. Such demands would preclude the opportunity to develop genuine, transformational renewable energy systems on a community, town or city scale. The Secretary of State should be praised for his determination and willingness to push the boat out much further than many of those vested interests would have felt comfortable with," he said.

Observers noted that no one rose in Commons to oppose final passage. Conservative Party leaders put the ruling Labour Party on notice that if the feed-in tariff provisions didn't pass, they would support the policy in a subsequent Conservative Government. Previously, Gordon Brown suffered an embarrassing back-bench revolt over the issue from his own party members.



The move by the British government has far reaching ramifications. The English speaking world has been more resistant to feed-in tariffs than non-English speaking countries, sometimes on ideological grounds, sometimes simply out of ignorance. Many North Americans, for example, attribute continental Europe's success with renewable energy to renewable portfolio standards, which is not the case.



Now that the British have clearly moved toward the camp favoring feed-in tariffs, there may be less reticence to do so elsewhere in the Anglophone world.