The Current - January 2012
Articles In This Issue:
- Help transform Maryland's energy landscape at MCEC's Legislative Reception
- CETI companies form joint ventures to pursue international opportunities
- AutoFlex lands contracts to supply electric vehicles and charging stations to Federal Agency fleets
- New financing, consumer protections raise hopes for offshore wind legislation
- State pursues clean energy gains in Constellation-Exelon deal
- Stein seeks to create "community renewables"
- Alliance claims wood stove program could give Marylanders affordable, clean energy
- MCEC selects 2012 Advisory Council
Help transform Maryland's energy landscape at MCEC's Legislative Reception
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The Maryland Clean Energy Center will host its 2012 Legislative Reception "Transforming the Maryland Energy Landscape: Turning Green to Gold" on Wednesday, February 8 at Governor Calvert House, 58 State Circle, Annapolis.
Help us show state policy makers that the clean energy and energy efficiency industries are helping sustain the local economy. This annual event brings together key policy makers, public officials and business leaders to discuss issues pending before the General Assembly which could affect the success of Maryland's clean energy sector for years to come.
This year's program will include:
- An MEA Status Report on where the state stands in efforts to meet goals for electricity demand reduction, the Renewable Portfolio Standard and greenhouse gas reductions;
- Updates on proposed legislation and energy issues, including the offshore wind bill, biomass and biofuel solutions, electric vehicle infrastructure and Marcellus Shale; and
- Success stories and job creation among Maryland companies who are boosting renewable energy generation, lowering energy costs and advancing new energy technologies.
Speakers at the Legislative Reception will include: Malcolm Woolf, Director of the Maryland Energy Administration; Sen. Thomas "Mack" Middleton; Peter Franchot, Comptroller of the State of Maryland; Francis Hodsell, Executive Director of the Maryland D.C. Virginia Solar Energy Industries Association; and Bob Parks, Energy Consultant for the Chester River Association.
Join us on February 8 as we continue to build Maryland's clean energy economy. For full details about the MCEC Legislative Reception or to register for the event, please go to our event website or call the Maryland Clean Energy Center at (301)738-6282.
CETI companies form joint ventures to pursue international opportunities
Two Clean Energy Technology Incubator (CETI) companies are embarking on an international, multi-million-dollar, clean energy venture after discovering an unexpected synergy between their technologies.
Executives from Strategic Services International (SSI) and Harness Industries met during a networking event hosted by CETI, which is a joint creation of the Maryland Clean Energy Center and the University of Maryland Baltimore County. The executives discovered that their business endeavors overlapped.
A subsidiary of an Annapolis-based telecommunications company, Harness Industries had focused on providing renewable energy systems to power the infrastructure of cellular companies, utilities and communications industries. Meanwhile, SSI which was developing renewable energy systems for a variety of industries, had started manufacturing cells on wheels (COWs), a mobile communications hub powered by wind and solar.
"We had no idea that a company like Harness existed. We had no idea what their capabilities were or that there would be these types of synergies," said Lynn Hogg, vice president and co-founder of SSI. "We discovered they have many years experience in the cellular telecom industry and had developed some unique capabilities – mounting, bracketry, power-management capabilities – for the cellular telecom space that they had basically shelved because power in the U.S. is ubiquitous and cheap" so there wasn't big market demand for Harness Industries' technologies.
Brendan McCluskey, vice president and founder of Harness Industries, jokes that "the first time I met Lynn, a voice in my head was screaming 'Competitor!' with the natural instinct to stay away from him. Over time, that changed through the encouragement of Bjorn Frogner [Entrepreneur in Residence] at CETI. We realized it only made sense to start collaborating. We had a product without a viable domestic market and SSI had an international market with a need for our product solution."
That international reach has proven key to the success of the Harness-SSI joint ventures.
"One key differentiator for us is the old Star Trek line of being willing to go where no man has gone before," Hogg said. "I hung out in Namibia for 12 weeks last year and we are not afraid to go into new areas. We carry a political risk map from Aon that tells us which countries we can go into and which we can't."
In Africa and the Caribbean, cellular service is pervasive not just to provide communications but also to support e-commerce in areas that lack banks and credit card services.
"Even in the most remote areas that I have been in Africa, the poorest guy on the street has one or multiple cellular phones," Hogg said.
Cellular towers, however, are often powered by on-site generators fuelled by imported diesel which is both expensive and prone to price spikes.
Consequently, SSI and Harness Industries formed two, joint-venture companies to engineer, build and install renewable-energy systems on cell towers across the Caribbean and Africa. Working in partnership with an extensive network of agents the companies established during their "Star Trek" travels, Harness and SSI have created a pipeline of business opportunities worth about $150 million and are working on closing several deals in 2012.
"If it were not for the incubator, [CETI], we never would have met these guys," Hogg said. "But lo and behold, now we have two joint-venture companies, bringing technology and solutions to the international market."
"We hope to be expanding our company's workforce here in Maryland to support our engineering and manufacturing needs in the near future," McCluskey said. "We all love what we're doing; creating green jobs here in Maryland and encouraging the long-term health of fragile economies in emerging markets, all the while promoting clean, renewable energy. What's not to like?"
AutoFlex lands contracts to supply electric vehicles and charging stations to Federal Agency fleets
After working for more than a decade to advance electric vehicles within the fleet industry, AutoFlex Inc. has landed a pair of Federal contracts that could trigger major growth at the Baltimore-based company.
In late December, the U.S. General Services Administration (GSA) awarded AutoFlex a five-year, Schedule 23V contract to supply electric vehicle (EV) charging stations, installation services and related equipment to federal departments and agencies. Earlier, the GSA awarded AutoFlex a Schedule 751 contract to lease a variety of OEM supplied and warranted electric vehicles to the Federal government.
Both contracts are part of the Federal government's first Electric Vehicle Pilot Program, a plan to initially lease 116 EVs for 20 agencies and outfit federal buildings in five test cities with EV charging infrastructure. The pilot is designed to advance plans to cut government petroleum consumption by 30 percent and begin leasing/purchasing only clean, alternative-fuel vehicles for the federal fleet by 2015.
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| AutoFlex Founder Luis MacDonald |
"This is going to be a multi-million-dollar sales opportunity for us, based on a GSA "best value" award for both technical factors and price, so we are very excited. We are positioned for growth in the emerging EV industry," said Luis MacDonald, president of AutoFlex.
The company – which partnered with Ohio-based, power-management company Eaton Corporation for the EV charging stations contract – has already received its first order for 60 charging stations. In addition, federal officials have informed AutoFlex that the EV pilot program is spreading beyond the original five test cities, MacDonald said. The Washington, DC pilot area, for example, has been expanded to include Baltimore. Growth in the pilot program, he said, will encourage agencies to upgrade more federal buildings with EV charging infrastructure.
Meanwhile, AutoFlex has already started supplying EVs to federal departments. In October, AutoFlex delivered five THINK City 100% EVs to U.S. Department of Veterans Affairs medical centers in Maryland. The Baltimore-based company will offer four EV models on its GSA leasing contract for model year 2012: the Chevrolet Volt, the Nissan Leaf, the Ford Transit Connect and the new Mitsubishi iMiEV. For example, the AutoFlex commercial lease for the iMiEV 100% EV to fleets is less than $350 per month.
MacDonald expects the two GSA contracts will trigger significant growth at AutoFlex. He plans to hire 20 additional employees over the next two years. To prepare for that growth, veteran-owned AutoFlex and Eaton engaged with the Department of Veterans Affairs and the Community College of Baltimore County to create Vetcars, a pilot training and jobs program that teaches veterans how to install and service EV charging infrastructure, as well as, earn a certificate to maintain new advanced battery technology.
The growth, MacDonald said, has been much anticipated.
"We have been in a business development phase within the re-invented auto industry for a while plus the economy hasn't been really good in the last few years," he said. "Those of us, who have been committed to the electric vehicle market, really haven't gotten our return on investment yet. But now there is light at the end of the tunnel and the electric vehicle industry will start to emerge in 2012."
New financing, consumer protections raise hopes for offshore wind legislation
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Could a new financing tool – the OREC – assuage the concerns of legislators, utilities and consumers, and allow an offshore wind bill to pass in the 2012 session of the General Assembly?
That's the hope of offshore wind supporters.
In a revised offshore wind bill released last week, Governor Martin O'Malley proposed to carve out a portion of Maryland's Renewable Portfolio Standard for offshore wind power and create a system of offshore wind renewable energy credits (ORECs) to help finance the clean energy developments. Developers would be able to sell the credits at market-driven prices to power companies who must meet state goals for clean energy use.
The OREC model replaces the governor's 2011 proposal to finance offshore wind projects by requiring utilities to sign 20-year, power-purchase agreements (PPAs) for offshore wind energy.
"All the utilities were concerned about having to sign those PPAs because they have an effect on their balance sheets and show up as an imputed debt for 20 years. That caused some utilities to fight the bill rather vigorously," said Bob Mitchell, CEO and Founder of Atlantic Wind Connection. The Chevy Chase-based company is attempting to build a transmission backbone to link offshore wind projects to the PJM grid. "I am hopeful with the change to an OREC program, none of the utilities will have any legitimate argument against this bill. I'm not predicting. I'm just hoping they will take an enlightened position."
The New Jersey legislature has already adopted an OREC program. Initial responses from developers and financiers indicate the system could be sufficiently large and stable to support the development of offshore wind farms.
The revised plan to finance offshore wind developments in Maryland also promises better protection for consumers.
Abigail Hopper, Governor O'Malley's Energy Advisor, said the administration spent a lot of time with legislators last summer and fall, listening to their concerns about offshore wind, and crafting a bill that would address those issues.
Along with the OREC funding mechanism, the administration added "an even more explicit protection for ratepayers," stipulating that any costs from offshore wind development that are passed along to residential customers would not exceed $2 per month and would not begin until the turbines begin delivering electricity. Hopper said that system protects the consumer and "places an appropriate amount of risk on the developers."
If the offshore wind bill passes a vote of the General Assembly this spring, Maryland could put its first offshore wind farm in operation in 2017. The O'Malley administration estimates that development could create 1,800 jobs during the construction phase and 360 permanent jobs once the facility goes into operation.
State pursues clean energy gains in Constellation-Exelon deal
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Revamped terms of the proposed merger of Constellation Energy and Exelon Corporation could deliver clean energy benefits to Maryland.
The proposed agreement which was recently endorsed by Governor Martin O'Malley, would require the merged company to make several large investments in clean energy projects in the state. They include:
Creating 30 megawatts of new solar capacity;
- Creating 125 megawatts of non-solar, Tier 1 renewable energy generating capacity;
- Contributing $90 million to a state fund to support the creation of Maryland's first animal-waste-to-energy facility;
- Contributing $30 million to a state fund supporting the development of offshore wind projects;
- Contributing $50 million towards home weatherization for low-income earners; and
- Contributing $10 million to EmPower Maryland programs.
Overall, the merged corporation would be required to tap clean energy sources for half of all its new power generation.
Abigail Hopper, Energy Advisor to Governor O'Malley, describes the proposed deal as "extremely important" to the Maryland's clean energy sector. The deal could double the state's solar capacity and land-based wind capacity. In total, it would generate enough clean energy to account for 1 percent of Maryland's total electricity use. Under the Renewable Portfolio Standard, the state is committed to drawing 20 percent of its electricity from clean energy sources.
"I think it shows the potential and the opportunity for the clean energy sector," Hopper said. "If a player like Exelon is able to invest that much in the clean energy sector, it speaks to the viability of the sector and the business opportunities here."
Maryland's Public Service Commission is scheduled to rule in mid-February on whether it will accept or reject the Exelon-Constellation merger.
Stein seeks to create "community renewables"
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Marylanders who don't own a suitable property for solar panels or wind turbines, may soon have a new way of tapping clean energy sources.
Delegate Dana Stein has drafted legislation that would facilitate the creation of "community renewables."
Under the bill's terms, groups of condominium owners, business associations or other collectives could jointly erect a solar array or wind power installation. By using net metering technology, the communal projects would generate credits on each owner's monthly electricity bill, based on the amount of electricity generated that month and the percentage stake each owner held. The community projects would also qualify for state grants for clean energy installations. Currently, those grants are only awarded to individual homeowners or businesses.
"This is an issue of equity and access. The goal is to make direct participation in renewable energy projects much more accessible to more people," Stein said.
Several other states have already adopted similar legislation which has given rise to numerous neighborhood clean energy installations and a new breed of clean energy business opportunities.
"In Colorado, for example, there is a company that has built a 500-kilowatt solar energy project and people can buy a minimum of two solar panels," Stein said. "They get a proportionate credit on their [electricity] bill for the solar energy generated. So if someone has a 5 percent ownership stake in a solar energy project, they will get 5 percent of the kilowatt hours generated that month as a credit on their bill. So these projects incorporate net metering and also allow a project to have many owners."
That community effort, he added, makes clean energy an affordable option to many more individuals and businesses.
Alliance claims wood stove program could give Marylanders affordable, clean energy
Maryland could give low-income residents access to clean energy and dramatically cut the state's carbon dioxide emissions if it expanded an existing grant program to cover wood stoves.
That's the argument of The Alliance for Green Heat – a nonprofit that promotes high-efficiency, wood-combustion systems as a sustainable, local, clean, and affordable heat source. Members of the alliance are hoping to convince government officials and legislators to endorse and fund grants for wood stoves before the 2012 session of Maryland's General Assembly ends.
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| Alliance for Green Heat President John Ackerly |
An existing state program provides grants to offset the costs of installing solar, wind and geothermal systems. John Ackerly, president of the Alliance for Green Heat, argues that the program unfairly excludes a clean source of energy, wood, and favors more expensive clean energy systems that are typically purchased by more affluent Marylanders.
"Right now, most of the grant program goes to wealthy Maryland families. Low-income people have pretty much been excluded because the renewable energy system that they prefer and they can afford is not covered," Ackerly said.
An analysis by the alliance reported that Maryland spent $3.9 million in 2009 subsidizing solar, wind, and geothermal installations. The grants, which ranged up to $10,000, enabled 873 families and small businesses to produce their own renewable energy. If Maryland invested the same amount of money in wood heat, the alliance concluded, the state could have helped 3,047 families offset up to 4.5 times more metric tons of carbon dioxide. That's because wood stoves typically cost about $3,000-4,000. Consequently, the grant program, which covers 30 percent of system costs, could fund each system for less than $1,500.
The Governor's Office, the Maryland Energy Administration, the Department of Natural Resources and the Maryland Department of Environment all support subsidizing clean-burning, wood heat systems, Ackerly said. The program, however, would need about $250,000 to begin the wood stove subsidy.
If those funds can't be secured soon, the alliance plans to ask members of the General Assembly to reintroduce legislation supporting the grant program. The bill died in committee last year over the funding issue.
Ackerly says the proposed grants for wood stoves would deliver multiple benefits. Specifically, the grants would:
- only apply to very low emission systems that are professionally installed;
- incentivize the replacement of old, polluting wood stoves;
- target families who currently use expensive heating sources, such as oil, propane and electricity; and
- support local jobs.
MCEC selects 2012 Advisory Council
Experts in solar, wind, biomass, other clean energy sources and energy efficiency systems as well as leaders in government, academia and finance have come together to form the 2012 Advisory Council for the Maryland Clean Energy Center.
The Advisory Council evaluates issues, reviews proposed policies and regulatory matters, facilitates relationships, advises MCEC staff and board members, and builds awareness of MCEC all in an effort to advance the center's mission.
"The members of the Advisory Council are instrumental in developing a work plan for MCEC and setting the framework for the organization's critical functions," said Kathy Magruder, MCEC's Executive Director. "Their wide-ranging expertise is critical to identifying and removing barriers to the success of clean energy initiatives in Maryland."
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| MCEC Advisory Council Chairman 2010-11 John Spears |
John Spears – President of the International Center for Sustainable Development and chair of the MCEC Adivsory Council in 2010 and 2011 – said the council members' deep and varied expertise makes the council uniquely suited to help advance economic development and job creation within the clean energy sector.
"We need a collaborative approach to advance cutting-edge technology in clean energy," Spears said. "Maryland is fortunate to have such a wealth of experts and a great environment to grow a new energy economy."
"MCEC is one of a very few organizations anywhere that creatively promotes and converges the best practices and applications of diverse technologies in the clean energy and energy efficiency sectors," said Robert Wallace, President and Chief Executive Officer of BITHENERGY, Inc. and a new member of the MCEC Advisory Council. "This convergence provides the engine that has the potential to create economic and social value that is sustainable over an extended period of time."
David Auger, a planning consultant with Townscape Design and another new member of the Advisory Council, added that "communities should be considering the implications of energy security, supply, and demand in planning for the future. I am looking for practical clean energy solutions to bring to the development community and think being involved with MCEC will help open up conversations with people who may not be talking to each other."