Fed works to speed solar development in Southwest

CHRIS KAHN | June 29, 2009 03:27 PM EST |

NEW YORK — The government will help companies build powerful solar farms in the desert Southwest by pre-qualifying huge swaths of federal land for development.

The Department of Interior said Monday it will designate 670,000 acres of federal land in Nevada, Arizona, California, Colorado, New Mexico and Utah as study areas for utility-scale solar projects.

The land will be divided into 24 tracts called Solar Energy Study areas.

Interior Secretary Ken Salazar said the department will work with states on environmental studies and permitting to speed solar development in those areas.

Our Perspective:

This is good news. Finally, the government is stepping forward and acknowledging the opportunities provided by alternative energy development.

I hope this is only the beginning!

Let us know your thoughts? You may leave a comment or email george@hbsadvantage.com

Swings in Price of Oil Hobble Forecasting

By JAD MOUAWAD

Published: July 5, 2009

The extreme volatility that has gripped oil markets for the last 18 months has shown no signs of slowing down, with oil prices more than doubling since the beginning of the year despite an exceptionally weak economy.

The instability of oil and gas prices is puzzling government officials and policy analysts, who fear it could jeopardize a global recovery. It is also hobbling businesses and consumers, who are already facing the effects of a stinging recession, as they try in vain to guess where prices will be a year from now — or even next month.

A wild run on the oil markets has occurred in the last 12 months. Last summer, prices surged to a record high above $145 a barrel, driving up gasoline prices to well over $4 a gallon. As the global economy faltered, oil tumbled to $33 a barrel in December. But oil has risen 55 percent since the beginning of the year, to $70 a barrel, pushing gas prices up again to $2.60 a gallon, according to AAA, the automobile club.

“To call this extreme volatility might be an understatement,” said Laura Wright, the chief financial officer at Southwest Airlines, a company that has sought to insure itself against volatile prices by buying long-term oil contracts. “Over the past 15 to 18 months, this has been unprecedented. I don’t think it can be easily rationalized.”

Volatility in the oil markets in the last year has reached levels not recorded since the energy shocks of the late 1970s and early 1980s, according to Costanza Jacazio, an energy analyst at Barclays Capital in New York.

At the close of last week’s trading, oil futures fell $2.58, to $66.73 a barrel, after rising above $72 a barrel last month.

These gyrations have rippled across the economy. The automakers General Motors and Chrysler have been forced into bankruptcy as customers shun their gas guzzlers. Airlines are on pace for another year of deep losses because of rising jet fuel costs.

And households, already crimped by falling home prices, mounting job losses and credit pressures, are once more forced to monitor their discretionary spending as energy prices rise.

While the movements in the oil markets have been similar to swings in most asset classes, including stocks and other commodities, the recent rise in oil prices is reprising the debate from last year over the role of investors — or speculators — in the commodity markets.

Government officials around the world have become concerned about a possible replay of last year’s surge. Energy officials from the European Union and OPEC, meeting in Vienna last month, said that “the speculation issue had not been resolved yet and that the 2008 bubble could be repeated” without more oversight.

Many factors that pushed oil prices up last year have returned. Supply fears are creeping back into the market, with a new round of violence in Nigeria’s oil-rich Niger Delta crimping production. And there are increasing fears that the political instability in Iran could spill over onto the oil market, potentially hampering the country’s exports.

The OPEC cartel has also been remarkably successful in reining in production in recent months to keep prices from falling. Even as prices recovered, members of the Organization of the Petroleum Exporting Countries have been unwilling to open their taps.

Top officials said that OPEC’s goal was to achieve $75 a barrel oil by the end of the year, a target that has been endorsed by Saudi Arabia, the group’s kingpin.

“Neither the organization, nor its key members, has any real interest in halting the rise in oil prices,” said a report by the Center for Global Energy Studies, a consulting group in

London founded by Sheik Ahmed Zaki Yamani, a former Saudi oil minister.

But unlike most of 2007, when the economy was still not in recession and demand for commodities was strong, the world today is mired in its worst slump in over half a century. The World Bank warned the recession would be deeper than previously thought and said any recovery next year would be subdued.

The International Energy Agency held out the prospect that energy demand was unlikely to recover before 2014. Yet the indicators that would traditionally signal lower prices — like high oil inventories or OPEC’s large spare production capacity — do not seem to hold much weight today, analysts said.

“Crude oil prices appear to have been divorced from the underlying fundamentals of weak demand, ample supply and high inventories,” Deutsche Bank analysts said in a recent report.

Investors are betting that the worst of the economic slump may be coming to an end, and are bidding up what they perceive will become scare resources once demand kicks back again, analysts said. This uncertainty is making it difficult for companies to plan ahead, they said.

“People do not like that kind of volatility, they want to know what their costs are going to be,” said Bernard Baumohl, the chief global economist at the Economic Outlook Group.

For the global airline industry, the latest price surge is certain to translate into more losses this year, according to the industry’s trade group, I.A.T.A. Airlines are expected to post losses of $9 billion this year, following last year’s losses of $10.4 billion. “Airlines have not yet felt the full impact of this oil price rise,” according to I.A.T.A.’s latest report.

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At Southwest Airlines, for example, fuel accounts for about a third of the company’s costs, according to Ms. Wright, the chief financial officer. The experience of the past year, she said, “has convinced us we cannot afford to not be hedged.”

The company has currently hedged part of its fuel use for the second half of the year at $71 a barrel, and for 2010 at $77 a barrel. Hedging acts as an insurance policy if prices rise above these levels.

But last year, Southwest reported two consecutive quarters of losses, as prices spiked and collapsed — all within a few months. “Prices were falling faster than we could de-hedge,” Ms. Wright said.

To survive the slump, many airlines have cut routes and raised both fares and fees, like charging for luggage, while some of the industry’s top players have merged. For example, Delta Air Lines bought Northwest Airlines last year, and in Europe, Lufthansa of Germany bought Austrian Airlines and Air France-KLM acquired Alitalia of Italy.

Likewise, automobile showrooms emptied out as gasoline prices rose, forcing General Motors and Chrysler to cut production sharply as they wade through bankruptcy. Meanwhile, they are under pressure from Washington to improve their fuel ratings.

“Do not believe for an instant that sport utilities are making a comeback,” George Pipas, Ford’s chief sales analyst, told reporters last week.

But to Jeroen van der Veer, who retired as chief executive officer of Royal Dutch Shell last week, prices are increasingly dictated by long-term assessments of supply and demand, rather than current market fundamentals. He advised taking a long-term view of the market.

“Oil has never been very stable,” Mr. van der Veer said. “If you look at history, you have to expect more volatility.”

Let us know your thoughts? You may leave a comment or email george@hbsadvantage.com

Just Do It

By THOMAS L. FRIEDMAN

Published: June 30, 2009

There is much in the House cap-and-trade energy bill that just passed that I absolutely hate. It is too weak in key areas and way too complicated in others. A simple, straightforward carbon tax would have made much more sense than this Rube Goldberg contraption. It is pathetic that we couldn’t do better. It is appalling that so much had to be given away to polluters. It stinks. It’s a mess. I detest it.

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Fred R. Conrad/The New York Times

Thomas L. Friedman

Now let’s get it passed in the Senate and make it law.

Why? Because, for all its flaws, this bill is the first comprehensive attempt by America to mitigate climate change by putting a price on carbon emissions. Rejecting this bill would have been read in the world as America voting against the reality and urgency of climate change and would have undermined clean energy initiatives everywhere.

More important, my gut tells me that if the U.S. government puts a price on carbon, even a weak one, it will usher in a new mind-set among consumers, investors, farmers, innovators and entrepreneurs that in time will make a big difference — much like the first warnings that cigarettes could cause cancer. The morning after that warning no one ever looked at smoking the same again.

Ditto if this bill passes. Henceforth, every investment decision made in America — about how homes are built, products manufactured or electricity generated — will look for the least-cost low-carbon option. And weaving carbon emissions into every business decision will drive innovation and deployment of clean technologies to a whole new level and make energy efficiency much more affordable. That ain’t beanbag.

Now that the bill is heading for the Senate, though, we must, ideally, try to improve it, but, at a minimum, guard against diluting it any further. To do that we need the help of the three parties most responsible for how weak the bill already is: the Republican Party, President Barack Obama and We the People.

This bill is not weak because its framers, Representatives Henry Waxman and Ed Markey, wanted it this way. “They had to make the compromises they did,” said Dan Becker, director of the Safe Climate Campaign, “because almost every House Republican voted against the bill and did nothing to try to improve it. So to get it passed, they needed every coal-state Democrat, and that meant they had to water it down to bring them on board.”

What are Republicans thinking? It is not as if they put forward a different strategy, like a carbon tax. Does the G.O.P. want to be the party of sex scandals and polluters or does it want to be a partner in helping America dominate the next great global industry: E.T. — energy technology? How could Republicans become so anti-environment, just when the country is going green?

Historically speaking, “Republicans can claim as much credit for America’s environmental leadership as Democrats,” noted Glenn Prickett, senior vice president at Conservation International. “The two greatest environmental presidents in American history were Teddy Roosevelt, who created our national park system, and Richard Nixon, whose administration gave us the Clean Air Act and the Environmental Protection Agency.” George Bush Sr. signed the 1993 Rio Treaty, to preserve biodiversity.

Yes, this bill’s goal of reducing U.S. carbon emissions to 17 percent below 2005 levels by 2020 is nowhere near what science tells us we need to mitigate climate change. But it also contains significant provisions to prevent new buildings from becoming energy hogs, to make our appliances the most energy efficient in the world and to help preserve forests in places like the Amazon.

We need Republicans who believe in fiscal conservatism and conservation joining this legislation in the Senate. We want a bill that transforms the whole country not one that just threads a political needle. I hope they start listening to green Republicans like Dick Lugar, George Shultz and Arnold Schwarzenegger.

I also hope we will hear more from President Obama. Something feels very calculating in how he has approached this bill, as if he doesn’t quite want to get his hands dirty, as if he is ready to twist arms in private, but not so much that if the bill goes down he will get tarnished. That is no way to fight this war. He is going to have to mobilize the whole country to pressure the Senate — by educating Americans, with speech after speech, about the opportunities and necessities of a serious climate/energy bill. If he is not ready to risk failure by going all out, failure will be the most likely result.

And then there is We the People. Attention all young Americans: your climate future is being decided right now in the cloakrooms of the Capitol, where the coal lobby holds huge sway. You want to make a difference? Then get out of Facebook and into somebody’s face. Get a million people on the Washington Mall calling for a price on carbon. That will get the Senate’s attention. Play hardball or don’t play at all.

Our Perspective:

Finally the Congress is recognizing there is an issue with emissions. For years, many have denied there is any correlation between emissions and climate change.

Leave it to the politicians to throw pork into an important issue.

Why would they recognize an issue, claim it and take responsibility for fixing it. They do not want to be held accountable for they have to run for reelection.

We can’t afford to push the rock any further.

Our ignorance has caused this problem.

But now that we acknowledge there is a problem, our arrogance can not let it continue.

We are only here for a short time. 

Everyday is a gift.

It is our responsibility to hand it over to the next generation, a world; that is in better condition than what we received.

This bill is flawed and we have to make our voices heard.

Have them pull the pork and make a real statement.

We can choose to lead by example! Just do it!

Let us know your thoughts? You may leave a comment or email george@hbsadvantage.com

Unemployment hits 9.5% in June

Written By Arthur Delaney   reported on Huffingtonpost.com

The U.S. economy lost 467,000 jobs in June as the national unemployment rate rose to 9.5 percent, the government announced on Thursday morning. While that’s only one-tenth of a percentage point from May, the current rate is the highest rate in 26 years.

Heidi Shierholz, an economist with the Economic Policy Institute, said that the loss of 6.5 million jobs since the start of the recession combined with the growth of the workforce means that the gains of the previous business cycle have been completely blown away.

“This is the only recession since the Great Depression to wipe out all jobs growth from the previous business cycle, a devastating benchmark for the workers of this country and a testament to both the enormity of the current crisis and to the extreme weakness of jobs growth from 2000-2007,” said Shierholz in a statement.

The ranks of the long-term unemployed — people out of work for 27 weeks or more — grew by 433,000 in June to a total of 4.4 million. Three in 10 of the unemployed are now long-term unemployed. The collapse of the housing industry contributes to their plight.

“We know right now because of the housing crisis that people can’t move to find another job,” Shierholz said. “People that in previous recessions may have been able to relocate to find another job can’t now.”

The Huffington Post has been profiling people who’ve been out of work for long periods of time. Marvin Bohn of Ohio hasn’t worked for a year and has been paying for his meds out-of-pocket. Steve Dittmann of Kansas said of the unemployed life, “I feel like I’m on the other side of a Plexiglass wall looking in.”

A broader measure of labor underutilization that accounts for people who’ve stopped looking for work hit 16.5% in June, a 0.1 percentage point increase.

“In June, there were large decreases in manufacturing, construction, and professional and business services,” said Bureau of Labor Statistics Commissioner Keith Hall in a statement. “Together, these three sectors have accounted for nearly three-quarters of the jobs lost since the recession began.

Many economists have predicted that even when the recession is technically over with the economy beginning to expand, there will be a “jobless recovery” as unemployment hovers in the double-digits.

Energy Bill Advances In Senate: Offshore Drilling, Renewables Nearer

Written by H. Josef Hebert   AP 6/17/09

WASHINGTON — Legislation that would require greater use of renewable energy, make it easier to build power lines and allow oil and gas drilling near the Florida coastline advanced Wednesday in the Senate.

The Energy and Natural Resources Committee approved the bill by a 15-8 bipartisan vote. But both Democrats and Republicans expressed concerns about the bill and hoped to make major changes when it reaches the Senate floor, probably in the fall.

The measure’s primary thrust is to expand the use of renewable sources of energy such as wind, solar and geothermal sources as well as deal with growing worries about the inadequacies of the nation’s high-voltage power grid.

But the bill also would remove the last congressional barrier to offshore oil and gas development, lifting a ban on drilling across a vast area in the eastern Gulf of Mexico that Congress put off limits three years ago. Drilling would be allowed within 45 miles of most of Florida’s coast and as close as 10 miles off the state’s Panhandle area.

The Senate bill for the first time would establish a national requirement for utilities to produce 15 percent of their electricity from renewable sources, a contentious issue that is likely to attract heated debate.

Twenty-eight states currently have some renewable energy requirement for utilities, but supporters of the measure argue a national mandate is needed to spur such energy development.

The legislation also would give much wider authority to federal regulators over the nation’s electricity grid.

The Federal Energy Regulatory Commission would be given authority to approve the siting of high voltage power lines if states fail to act and would be given additional powers over cyber security on the grid.

Senate Majority Leader Harry Reid, D-Nev., has said he hopes to take up energy legislation after the August recess, although it’s uncertain whether it will be merged with separate legislation addressing climate change. The House is working on a climate bill that includes many of the same energy issues addressed by the Senate bill.

While the bill was approved by a safe margin in the committee its prospects in the full Senate are anything but certain. Several senators called it too weak in its support of renewable energy development, while others said it ignored nuclear energy and greater domestic oil and gas production.

“None of us got all we wanted,” said Sen. Jeff Bingaman, D-N.M., the committee’s chairman, who was forced to agree to a variety of compromises to give the bill a chance of advancing. Nevertheless, he said the bill would help shift to cleaner, more secure sources of energy.

Bingaman and many of the panel’s other Democrats had wanted at least a 20 percent renewable energy requirement. The bill requires 15 percent renewable use by 2021, but also would allow utilities to avoid a fourth of that mandate by showing improvements in efficiency. Renewable energy use could be cut further for utilities that increase their use of nuclear energy either from a new reactor or increased reactor output.

“This is an extraordinary weak bill,” said Sen. Bernie Sanders, I-Vt.

But Sanders voted to advance the bill, as did Sen. Bob Corker, R-Tenn. Both senators said they hoped the bill will be strengthened.

“I suspect their definition of strengthening might be somewhat different,” quipped Sen. Evan Bayh, D-Ind., whose own support of the bill came despite strong opposition to the federal renewable energy requirements on utilities.

Sanders wants the renewable energy requirement to be much higher, at 25 percent. Corker said the bill needs more to promote nuclear energy and domestic oil and gas production.

“We simply must do more to increase our domestic (oil and gas) production and use of nuclear energy,” said Sen. Lisa Murkowski of Alaska, the committee’s ranking Republican. Still, she voted for the bill which includes a commitment to increase loan guarantees for a natural gas pipeline in her state from $18 billion to $30 billion.

The bill also calls for establishing a new office to steer grants and loan guarantees to clean energy projects, including nuclear and those using technology to capture carbon dioxide; creating an oil products reserve to be used if there are supply problems; and creating federal standards for efficiency standards for new building.

The Chamber of Commerce said the bill shows progress toward crafting a comprehensive energy policy, but some environmentalists said it falls short of shifting the country away from fossil fuels. With its new offshore drilling, support for coal and nuclear energy “this bill fails to live up to the vision of a clean energy future,” complained Brent Blackwelder, president of Friends of the Earth.

Study: US technology key to China and climate

H. JOSEF HEBERT | June 19, 2009 05:16 AM EST 

 

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WASHINGTON — Finding an economical way to capture carbon dioxide from existing coal burning power plants is key to getting China to reduce its greenhouse gas emissions as well as for U.S. efforts to combat global warming, says a study being released Friday.

The report by the Massachusetts Institute of Technology concludes that the United States cannot meet its targets for stabilizing greenhouse gases unless it finds a way to economically capture carbon dioxide emissions coming from existing coal-burning power plants.

coal plants generate about half of the country’s electricity and 80 percent of the nearly 2 billion tons of carbon dioxide released annually into the atmosphere from power production. China also relies heavily on coal for electricity production and in the last five years has been on a rush to build new coal plants _ none of them designed to capture carbon dioxide.

“There is no credible pathway towards stringent greenhouse gas stabilization targets without CO2 emission reductions from existing coal power plants,” says the report. Members of Congress, where a bill to limit U.S. greenhouse gas emissions could come up for a House vote as early as next week, were being briefed on the MIT report.

Carbon dioxide has been captured and put into the ground in relatively small scale projects _ mostly in connection with enhanced oil recovery, for years, but never in the huge volumes that would be needed to capture emissions from a large coal plant.

The MIT report says there are multiple technologies being explored for carbon capture, but the government still has not adequately supported carbon capture research and is moving too slowly to develop large demonstration projects to show that capturing carbon dioxide and injecting it into the ground will work at the scale needed.

The report, a copy of which was provided to The Associated Press in advance of a press conference Friday, says the federal government and industry need to “dramatically expand” its support for carbon capture research and development to the tune of $12 billion to $15 billion over the next decade. 

Such technology, if shown to work in U.S. plants, could get China to reduce greenhouse gases from its rapidly growing network of coal burning power plants, the report says.

“We’ve got to address the carbon emissions from our current fleet (of coal plants) and also have to think how the technology we develop can be applied in China,” Ernest Moniz, director of the MIT Energy Initiative and co-author of the report, said in an interview.

Together, the U.S. and China account for 20 percent of the world’s carbon dioxide from coal burning power plants, said Moniz. If China doesn’t address emissions from its coal plants “we really can’t address the climate issue in a serious way.”

The MIT report summarizes a consensus view of participants in a symposium sponsored by MIT’s Energy Initiative on the feasibility of retrofitting existing coal plants with carbon capture technology. Participants included 54 representatives utilities, academia, government, public interest groups and industry.

The report said about half of the U.S. coal plants _ most of those producing 300 megawatts or more of power _ may be suitable for carbon capture technology. Many of the smaller plants, accounting for about 30 percent of electricity production, can achieve emission reductions through increased efficiency, use of a mix of coal and biomass as fuel and other measures. Other plants, especially the oldest, may have to be replaced, said Moniz.

Wayne Leonard, chief executive of Entergy Corp., who was a co-chairman of the symposium, said the symposium’s conclusions should be viewed “in an international context” especially as carbon capture technology development relates to China.

“In the U.S. coal is the reality. But in China and India it is the future” and they won’t abandon it because of climate change, said Leonard. “But offering them a technological solution, a solution that we are actively developing and deploying ourselves on our own coal plants, would be something that has a far better chance of success in getting them to act.”

While Entergy, the New Orleans-based utility, relies on coal for less than 10 percent of its electricity production, it was a co-sponsor with MIT of the carbon capture symposium on which Friday’s report is based.

CoStar Convenes Experts to Discuss Opportunities, Challenges of Green Building

By Andrew C. BurrJune 17, 2009

Panel Examines Greening the Built Sector

CoStar’s green building panelists, from left: Marc Heisterkamp of USGBC; Laurie McMahon of Cassidy & Pinkard Colliers; Steve Teitelbaum of Jones Day; and Thomas Olson of Environmental Defense Fund.

If the energy consumption of commercial buildings was likened to the fuel efficiency of cars and trucks, it would look something like this: one quarter of Americans currently work in buildings that are the equivalent of a Toyota Prius or other type of fuel-efficient hybrid while the remaining three-quarters work in buildings comparable to gas-guzzling Hummers, Winnebagos and Mack tractor trailers.

But while it’s fairly obvious which vehicles are more efficient and environmentally friendly, it’s very difficult to tell from observation which buildings are designed and are being operated in the most environmentally efficient and responsible way.

That is one of the challenges currently facing tenants and landlords who favor green workplaces and stores, according to a CoStar Group-sponsored roundtable discussion on green buildings that convened Wednesday.

Hosted by CoStar Group President and CEO Andrew C. Florance, the panel included Marc Heisterkamp, director of commercial real estate at the U.S. Green Building Council; Laurie McMahon, managing director and principal of Washington-based Cassidy & Pinkard Colliers; Thomas Olson, a consulting attorney for the Environmental Defense Fund’s National Climate Campaign; and Steve Teitelbaum, principal of the law firm Jones Day.

The issue of tenants, real estate brokers and landlords all having access to more transparent and readily available information to enable them to make better informed decisions remains one of the biggest challenges facing the industry today, noted the panelists. At the same time, they credited the growing awareness of sustainability and energy efficiency issues associated with commercial property largely to the success of the U.S. Government’s Energy Star label for energy efficiency and USGBC’s LEED green building certification.

Before LEED, which was created about a decade ago, sustainable building design and operation lacked a “common framework” for the industry to coalesce around, Heisterkamp said.

Today, the LEED program touches more than 5.6 billion square feet of commercial space and has transformed the once-boutique USGBC into an industry giant. According to McMahon, LEED has become “the glossary on how to be green” for many building stakeholders.

Energy Star, which has enjoyed a similar swell in popularity, has been used to benchmark the energy usage of about 12 billion square feet of real estate, which includes roughly 40% of all U.S. office buildings, according to recent data from the U.S. Environmental Protection Agency.

Buildings with either label have been tied to financial benefits for owners, health and productivity gains for tenants, and lower building operations and maintenance costs. Several academic studies, including one by CoStar, have published compelling evidence that sustainable and energy-efficient buildings command higher sales prices, rental rates and occupancy than their non-green peer buildings.

Even during the recession, CoStar Group data shows that occupancy levels in LEED buildings continue to climb, while occupancy in comparable non-LEED buildings has eroded. “LEED buildings are dramatically outperforming the non-LEED buildings,” Florance said.

According to Teitelbaum, the benefits for those who occupy green buildings go far beyond lower operating expenses. Employers are increasingly correlating their sustainable offices with increased work productivity, lower absenteeism and higher employee retention — significant advantages for businesses of all shapes and sizes.

“We focus a lot, because we’re real estate people, on the operating expenses. It’s an easy one,” he said. “But the benefits go beyond just operating expenses. There are studies that show in many cases, you get productivity benefits out of green buildings that far outweigh any expenses.”

Forces from outside the industry are also driving real estate sustainability. Policymakers are moving briskly to enact sustainability and energy efficiency mandates for commercial structures, which can account for up to 80% of greenhouse gas emissions in large cities.

In April, New York City Mayor Michael Bloomberg proposed a sweeping package of energy efficiency mandates that would require commercial building owners to audit and disclose the energy use of their buildings, and in some cases, demonstrate energy efficiency improvements. Mandates for sustainable development are common now in many cities, and in Washington, DC, and the state of California, energy disclosure laws for privately owned buildings are also on the books.

Those provisions, coupled with a national building energy label that is proposed at the federal level, would help the building industry become more energy-transparent Florance said. “You know if your neighbor drives a Hummer to work every day. You don’t know if they work in a “Hummer” building,” he said.

But the green building movement remains a work in progress, the panelists said, with obstacles and misperceptions about sustainability still prevalent in parts of the market.

For instance, cost premiums for LEED certification are still greatly exaggerated in many circles, and divergent definitions and expectations about what is “green” often put building stakeholders at odds with each other, the panelists said.

And though landlords are often criticized for not being sustainable enough, tenants are known to hedge on rent increases in green buildings, public transit requirements and the cost of green cleaning programs, Teitelbaum said. “You see resistance on the tenant side as much as on the landlord side. It’s not a one-way street.”

The industry is also coming to terms with how to best address the existing building stock, which remains a mostly untouched wilderness of inefficient and unsustainable buildings. Just 1% of all U.S. properties have achieved the Energy Star label or LEED certification, according to CoStar information, and a lion’s share of those have been constructed recently.

To make a real impact on climate change, retrofitting existing buildings is an essential part of the equation, Olson said.

“In the past few years, the amount of carbon dioxide the world has been emitting has actually been more than people thought was the worst that could possibly happen,” Olson said. “We are already seeing the effect of the carbon dioxide we’re putting into the atmosphere.”

But if the commercial real estate industry remains committed to energy efficiency and sustainability, “you can be heroes in terms of climate change, make money, and you can go home and tell your kids that you’re green,” he said.

Our Perspective:

I find the statistics of abuse staggering. When most of the commercial building were developed, the last thing they thought about was energy efficiency.

For companies located in New Jersey, they have developed the Energy Star Program. the state will help to underwrite an energy efficiency audit done by an approved contractor and will also  help to underwrite upto 50% of the investment to make the building more efficient.

New Jersey’s Clean Energy Program – recognized as a national model – is a statewide program that:

• Promotes increased energy efficiency
• Supports installation of clean, renewable sources of energy
• Provides information to help reduce energy use
• Endorses climate change solutions, and
• Offers financial incentives, programs, and services for residential, commercial, and municipal customers to save energy, money, and the environment. 

Would you like to know more? Feel free to contact us george@hbsadvantage.com or call 856-857-1230. We can help walk you thru the process.

PA Poised for Solar

By Jane M. Von Bergen

Inquirer Staff Writer

Gov. Rendell stood on the deck of a Roxborough home last month talking about how the $100 million in the Pennsylvania Sunshine rebate program would make it possible for homeowners to afford an energy-saving solar system.

In Malvern, the $800,000 solar system that Siemens Medical Solutions installed in 2006 is yielding $18,000 a year in savings. With a state grant reducing the cost to $400,000, building manager Kevin Matthews expects the system to pay for itself by 2013.

To the 80 or so electrical contractors, suppliers, and electricians’ union officials at a seminar hosted by the National Electrical Contractors Association’s Penn-Del Jersey chapter yesterday, these examples prove that the solar-energy market is ready to yield its financial promise.

That is why the contractors want everyone to understand that, fundamentally, it is electrical work and that their employees, members of the International Brotherhood of Electrical Workers, are already trained to handle the jobs.

“There is a green workforce prepared to install these sustainable-energy projects,” said Kenneth MacDougall, business-development director for the contractors’ association.

Regardless of whether power originates from the sun or a dam, it is electricity and it moves through wires, he said.

MacDougall works closely with IBEW Local 380 in Collegeville, which has added green-energy training to its five-year electrical-apprenticeship program. Its facilities include a solar structure that apprentices use to practice installing solar panels and connecting them to the structure’s electrical system.

Union and management work together to develop and fund the training.

Green-energy work “all seems so new and fascinating, but we’ve been doing it,” said David Schaaf, business manager of Local 380.

But there are hitches in the pitch. Pennsylvania’s Department of Energy, for example, wants solar contractors used in the Sunshine rebate program to be certified by the North American Board of Certified Energy Practitioners.

The national electrical contractors’ association and the union are close to convincing the board that its training meets board standards, a national apprentice-training director told the group.

But there is another problem. The board requires contractors to have a certified practitioner on staff when they bid for the work.

That is not an issue for Union Electrical Contracting Co., the Fort Washington company that handled the Siemens job. It employs 100 electricians, including a dozen who work on solar projects.

But smaller contractors bidding on residential projects probably will not have that kind of person on staff. Instead, they would call the union for a journeyman trained in solar. MacDougall said that his organization and union officials were trying to persuade the state to amend regulations to accommodate this common type of building-trade business model.

Our Perspective:

Pennsylvania is open for the solar business!

Rebates are available for under 50KW systems, which is mostly geared toward residential and small business.

Should you be a small business and intersted in how the state and federal incentives will accelerate  the payback on your solar investment, email george@hbsadvantage.com or call 856-857-1230

Come to think of it

Has the recent turndown in the economy had an effect on your business?

What steps have you taken to tighten the belt?

Did you reduce the workforce? 

Did you reduce or drop employee benefits? 

In difficult times you may find you have to think outside the box. Reducing the workforce and employee benefits are obvious choices. 

There are diamonds in the rough out there! 

Where you ask? If you only knew!

 Most companies budget for expenses and never really drill down to see if there are opportunities for savings.

 Deregulated Energy: Natural Gas and Electric

 Is your company paying more than $5000 a month on natural gas or electric for your building! 

The deregulated Gas and electric market is the lowest it has been in the last 3 to 4 years. 

Our clients are saving from 15% to 30% on natural gas. 

 

Just in the last week, we saved a client over $45,000 by locking in their Natural gas for the next 12 months.

 

Our electric clients are saving from 6% to 15%

 

Just last week, a client saved over $94,000 by locking in their electric for the next 12 months.

 

How much do you think your company may qualify to save?

The local provider buys gas and electric in the wholesale marker and sells it to you retail.

We put our clients in the wholesale position.

 The savings is yours and falls to the bottom line!

 Voice and Data:

Here is the real sleeper. Many companies feel they wear a safety blanket for they have Verizon or ATT as their provider.

You are paying a premium for that blanket!

Deregulation allows third party providers to use the Verizon / ATT platform and deliver voice to their clients at a discount.

 Our clients are saving from 15% to 40% on their monthly Voice and Data Billing. 

What is 25% of your bill?

 Come to think of it, we haven’t looked at these costs recently?

 Call Hutchinson Business Solutions 856-857-1230. There is no fee for our services!

 Or you can email george@hbsadvantage.com

 

Let the savings begin!!!!!

‘Smart grid’ _ power lines move into digital age

H. JOSEF HEBERT | June 6, 2009 10:30 PM EST |

WASHINGTON — Thomas Alva Edison, meet the Internet. More than a century after Edison invented a reliable light bulb, the nation’s electricity distribution system, an aging spider web of power lines, is poised to move into the digital age.

The “smart grid” has become the buzz of the electric power industry, at the White House and among members of Congress. President Barack Obama says it’s essential to boost development of wind and solar power, get people to use less energy and to tackle climate change.

What smart grid visionaries see coming are home thermostats and appliances that adjust automatically depending on the cost of power; where a water heater may get juice from a neighbor’s rooftop solar panel; and where on a scorching hot day a plug-in hybrid electric car charges one minute and the next sends electricity back to the grid to help head off a brownout

It is where utilities get instant feedback on a transformer outage, shift easily among energy sources, integrating wind and solar energy with electricity from coal-burning power plants, and go into homes and businesses to automatically adjust power use based on prearranged agreements.

“It’s the marriage of information technology and automation technology with the existing electricity network. This is the energy Internet,” said Bob Gilligan, vice president for transmission at GE Energy, which is aggressively pursuing smart grid development. “There are going to be applications 10 years from now that you and I have no idea that we’re going to want or need or think are essential to our lives.”

Hundreds of technology companies and almost every major electric utility company see smart grid as the future. That interest got a boost with the availability of $4.5 billion in federal economic recovery money for smart grid technology.

But smart grid won’t be cheap; cost estimates run as high as $75 billion. Who’s going to pay the bill? Will consumers get the payback they are promised? Might “smart meters” be too intrusive? Could an end-to-end computerization of the grid increase the risk of cyberattacks?

Today’s grid is seen by many as little different from one envisioned by Edison 127 years ago.

The hundreds of thousands of miles of power lines that crisscross the country have been compared to a river flowing down a hill: an inefficient one-way movement of electrons from power plant to consumer. There is little way to provide any feedback of information to the power company running the system or those buying the electricity.

“The heart of a smart grid is to make the grid more flexible, to more easily control the flow of electrons, and make it more efficient and reliable,” said Greg Scheu, head of the power production division at ABB North America, a leading grid technology provider.

“The meter is only the beginning,” said Alex Huang, director of a grid technology center at North Carolina State University. He said that instead of power flowing from a small number of power plants, the smart grid can usher in a system of distributed energy so electricity “will flow from homes and businesses into the grid, neighborhoods will use local power and not just power flowing from a single source.”

There are glimpses of what the future grid might look like.

On the University of Colorado campus in Boulder, the chancellor’s home has been turned into a smart grid showhouse as part of a citywide $100 million demonstration project spearheaded by Xcel Energy. The home has a laptop-controlled electricity management system that integrates a rooftop solar panel with grid-supplied power and tracks energy use as well as equipment to charge a plug-in hybrid electric car.

Florida Power & Light is planning to provide smart meters covering 1 million homes and businesses in the Miami area over the next two years in a $200 million project. Smart meters are being distributed by utilities from California to Delaware’s Delmarva Peninsula.

“We’ve got about 70 (smart grid) pilots all over the country right now,” said Mike Oldak, an expert on smart grid at the Edison Electric Institute, which represents investor-owned power companies.

Center Point Energy, which serves 2.2 million customers in the metropolitan Houston area, expects to spend $1 billion over the next five years on smart grid. Residential customers are seeing an additional $3.24 a month on their electric bills, but Center Point says that should be more than offset by energy savings.

An Energy Department study projects energy savings of 5 percent to 15 percent from smart grid.

“This pays for itself through efficiency and demand reduction and if you don’t look at it from that perspective you won’t get your money back,” said Thomas Standish, group president for regulated operations at Center Power Energy.

The cost and payback have some state regulators worried.

“We need to demonstrate to folks that there’s a benefit here before we ask them to pay for this stuff,” says Frederick Butler, chairman of New Jersey’s utility commission and president of NARUC, the national group that represents these state agencies.

Energy Secretary Steven Chu, said the current grid stands in the way of increasing the use of renewable energy sources such as wind and solar that “will need a system that can dispatch power here, there and everywhere on a very quick basis.”

But Chu and others also worry about security. “If you want to create mischief one very good way to create a great deal of mischief is to actually bring down a smart grid system. This system has to be incredibly secure.”

And there is the issue of intrusion.

“Is the average consumer willing to pay the upfront costs of a new system and then respond appropriately to price signals? Or will people view a utility’s ability to reach inside a home to turn down a thermostat as Orwellian?” Sen. Lisa Murkowski, R-Alaska, said at a recent hearing on smart grid.