|By Blair Loftis, Vice President and Global Girector of Renewable Energy, Kleinfelder|
Whatever happened to the notion that collaboration is the key to success? Why is it that we are not taking advantage of obvious synergies between two competing sources of clean renewable energy – solar and wind – in an increasingly competitive market where subsidies are likely to disappear?
Perhaps I’m delusional, but, as an engineer who has worked in both sectors for the last decade, it seems there are clear and compatible synergies. Admittedly, I don’t have all the answers, but I believe the questions pose ample provocation for action.
As we all know, the wind market is at serious risk of losing significant subsidies with the expiration of the production tax credit (PTC). Many believe this could be the nail in the coffin to an industry that was thriving just 24 months ago. Similarly, photovoltaic (PV) module prices have dropped to a ridiculous low, making it very difficult for good old vertically integrated American companies to compete in a global marketplace. I’m certainly empathetic to each sector’s market risks, but, rather than curl up in a ball and writhe in a manic depression spurred by poor policy, let’s pull ourselves up and do something productive.
We need to explore the opportunities, the advantages, and, more than anything, the synergies. As a start, here are the top three advantages:
Advantage Number 1
Wind owners and operators got to market first. That means they have already done the dirty work, which includes securing land, entitlements and environmental clearances. They have negotiated amenable contracts with the surrounding community. Even more important, they have found a market for the electrons (power purchase agreement) and a means to get the electrons to the market (interconnection agreement).
Advantage Number 2
In between all of those wind turbines is considerable vacant land. The land around wind farms is often flat and located in regions with favorable direct normal irradiance (DNI).
Advantage Number 3
Solar is peak coincidental and wind is intermittent. Even more interesting is that in many areas wind rises in both speed and consistency in the late afternoon and evening hours. Electric utilities and other purchasers of wind energy struggle with the dispatch of the electricity because of the intermittency of the resource.
Now, let’s explore the synergies.
Solar developers typically start with land control – sometimes to their detriment. They often bet that all the other critical details, such as power purchase and interconnection agreements, will work out. Wind asset developers already have these agreements guaranteed. Sure, the power purchase agreement and interconnection agreements are for a specific purpose and a specific plant capacity, but you can bet there are a few wind projects out there that are under producing, thereby leaving a bit of latent capacity at the point of interconnection and a less than optimized power purchase agreement. It’s a new twist on power marketing and origination, but suffice it to say the door is probably open, or at least it’s not locked. The off-taker may actually favor the addition of solar amongst the wind project as a means to help shape the resource. There will be those who fear that the shadows from the wind turbines will adversely impact the solar output. Well, maybe, but I have been at this too long and seen a lot worse.
As for the reams of permits (NEPA, CEQA, USACE, FEMA, FAA, SHPO…the acronyms never end), these can often be repurposed to accommodate changes. It is less expensive for guys like me to repurpose a permit with the agency having jurisdiction (AHJ) than it is to start from scratch. Another benefit is the agency having jurisdiction is familiar with the site conditions and may favor additional development at an existing project than a proponent seeking development of yet another greenfield.
So, as your mother probably told you, play nice. Consider an arrangement that accelerates the return on investment (ROI) for the wind developer while reducing the installed cost for the solar developer. Let’s look for a way to collaborate and co-locate. Consider the billions of dollars spent on major initiatives like the Competitive Renewable Energy Zone (CREZ) in Texas to get ample wind resource to hungry load centers. The way it is looking, I’m not confident CREZ will see its ultimate benefit from wind. Perhaps, on CREZ or other similar projects, there’s a co-location solution.
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