ohio and nation must continue supportive policies to remain leaders in alternative energy
Many Ohioans are probably not familiar with Van Wert, a western Ohio town of 10,000 located 33 miles west of Lima. But in the alternative energy community, Van Wert is making a name for itself.
“The first major wind farm went online earlier this year,” says Jack Clock, Southwest Ohio Project Coordinator for Green Energy Ohio
. This project of 150 wind turbines alone is generating nearly 225 megawatts of electricity, which is enough to power about 50,000-60,000 residential homes.
Van Wert is not the only hotbed of alternative energy activity in Ohio. Cleveland and Toledo were ranked among the Top 10 cleantech job markets in the U.S. in a 2011 study by the Brookings Foundation. In fact, according to the nonprofit group Jumpstart Inc., "Ohio ranks # 1 in the nation for renewable and advanced energy, bringing in more renewable energy facility projects than any other state."
Projects like the Van Wert wind farm have found support from the state government. In 2008, the Ohio House of Representatives passed a measure that set aside funds for renewable energy projects across the state. SB 315 updated the program this spring, Clock explains. “Under this program, Ohio must provide 25 percent renewable energy to all investor owned utility customers by 2025. Of that 25 percent, one half must originate from within the state.”
But state government isn’t always so friendly towards alternative energy. Clock laments that Ohio leaders allowed a program called the Advanced Energy Fund, which helped homeowners and small businesses pay for renewable energy projects, to expire. “Not having that program has hurt the small renewable energy installers as most of their business is residential.”
To make matters worse, a federal wind tax credit in support of many of Ohio’s alternative energy projects is about to expire unless Congress votes to extend it. In an election year, the mood isn’t very optimistic.
Thankfully, larger installers have managed to sustain themselves and even thrive thanks to financing programs like Power Purchase Agreements. “This program is used by governments and other nonprofits that cannot claim tax credits,” explains Clock. “The third party financier claims the credits and that helps to justify the long-term contracts.”
Individual consumers can get in on the action, too. GEO offers up to $2,400 for a solar hot water heater if installed by a certified installer
, and there’s a 30 percent federal tax credit for residential and commercial installation of a solar system.
Yet to continue this steady growth, state and federal officials must focus on policies that support the alternative energy industry, its leaders say.
Alternative energy advocates argue that the answer to feeding the world’s massive energy consumption needs clearly lies in a strong relationship between the government and private sector. Not only will the expansion of this market help to wean the U.S. off of foreign oil, it will also promote sustainability in the region and create next-generation jobs for Ohioans.
caught up with three leading alternative energy companies in Ohio to talk about the growth of their business and what state and federal leaders need to do to stay competitive.
Third Sun Solar
Located in Athens, Ohio, Third Sun Solar
is a full-service provider of clean energy systems across the Midwest. Their mission is to accelerate the growth of clean energy solutions in the region.
Third Sun Solar leapt into the solar energy industry over 14 years ago. Ohio has long been their primary market, but they’ve also been able to crack into surrounding markets in Kentucky and Indiana.
“Our reach is now expanding into many other states right now as the state-by-state incentives and renewable portfolio goals often drive the market for solar,” explains CEO Michelle Greenfield, reiterating the need for government to provide incentives like rebates and tax credits in order for the market to expand. “Recent reductions in rebates in Ohio has slowed our growth in this state," she laments.
Still, Greenfield boasts that Third Sun remains a strong project developer and installer due to the rapidly falling cost of solar. In fact, the firm is currently installing its largest project to date – a 1.7 Megawatt system for Assurant, a Fortune 500 company with a campus in Springfield, Ohio. Robert Misbrener, Project Manager at the Office of the University Architect at Kent State University is pleased with a recent installation at the university field house, saying “The system outperformed power expectations for August by almost 18 percent.”
But in order to continue expanding, more government support is needed, says Greenfield. “There’s a national debate right now over whether the renewable energy industry should be receiving government subsidies. But in reality, entrenched energy industries, like coal, oil and gas all receive a great deal of subsidization from state and federal governments.” Seventy percent of U.S. energy subsidies go to oil, natural gas and coal industries, while only 5 percent go to the renewable energy sectors of solar, wind and geothermal, she says.
Her sense of the way forward is crystal clear: “The countries that are now leaders in the solar industry and creating thousands of jobs are those with governments that have invested in supporting and building this advanced energy sector.”
is one of the oldest and largest renewable energy firms in the Ohio, with offices across the state. “We are one of the few that provide all three major technologies – solar electric, solar thermal and wind,” says President Alan Frasz.
Over its 17 year history, Dovetail has completed over 235 system installations that include more than 4.5 Megawatts of solar and wind energy across Ohio. The company has a small presence in New York, Michigan, Kentucky, Pennsylvania and West Virginia, and services businesses, institutions and homeowners.
In February, Dovetail finished installing a solar array at Fortin Ironworks
, a manufacturer in Columbus. “We are enjoying savings of up to 50 percent on our electricity usage per month,” says President Dan Fortin, adding that customers who have seen the array are now interested in installing their own systems. “With the available tax credits, energy savings and Solar Renewable Energy Credit, our investment should pay for itself within a 4-5 year period.”
Needless to say, Dovetail is thriving in the renewable energy market. “We have approximately 17 projects currently under contract that are in various stages of implementation. We are expanding all areas of our business, including designers, installers, electricians, projects managers and a procurement specialist."
Dovetail has hired eight additional employees this year to form a team of 35, and they expect substantial growth in 2013 and beyond thanks in large part to the decrease in cost for solar materials. Advances in system performance and reliability have done their part to bring costs down as well.
“This is making the technology more and more affordable, while increasing its value compared to traditional fossil fuel alternatives.” Frasz says the cost for Dovetail’s solar modules has declined more than 70 percent in just the last 20 months, noting solar technology also has minimal cost of maintenance.
Although companies like Dovetail and Third Sun Solar are experiencing growth, Frasz says they’re only scratching the surface of the number of homes, businesses and organizations that can benefit from their systems. He says that unfamiliarity with renewable energy is an obstacle, and they have to teach consumers about the technology, economics and government incentives. “For example, most people and businesses don’t know that solar panels are warranted for 25 years.”
Another struggle is changing consumer habits. “People seem to only want to consider investments that have an immediate payback or less than a 3 year return on investment. In our disposable, throw-away society, we tend to overlook or discount investments in things that last and will save money and the planet.”
Like Clock, Frasz stresses the need for government participation. “Smart, consistent, long-term government policies need to continue to drive this innovation and investment as solar becomes a larger share of our overall energy mix.”
Echogen Power Systems
, headquartered in Akron, is a different player in the renewable energy game than Third Sun Solar and Dovetail. Their role involves designing and supplying thermal engines that repurpose usable [waste] heat found in steam generating and direct-fired heating processes. They turn it into electricity for a variety of markets, including chemical processing, oil and gas exploration and transmission, petroleum refining, iron and steel, glass and cement.
The secret ingredient to their success is their modified Rankine Cycle (converting heat into work) that uses supercritical carbon dioxide (sCO2) as a working fluid.
“Echogen Thermafficient systems reduce energy operating costs that large consumers of power must currently source from the grid,” explains Ed Zdankiewicz, Strategic Account Manager at Echogen. Not only are the systems friendly to a company’s bottom line, but they also reduce emissions.
Currently, Echogen is nearing completion on two product development programs involving their heat engines for large-scale industrial applications. They were also recently awarded a three year, $8 million contract from the Department of Energy’s SunShot Program for concentrated solar power as part of a team led by the National Renewable Energy Laboratory. Though that partnership, Echogen will help develop a 10 megawatt carbon dioxide power turbine capable of operating at 700-degrees Celsius under dry cooling conditions.
The goal, Zdankiewicz says, is to “confirm a pathway for achieving a Levelized Cost of Energy (LCOE) of under $0.06 per kilowatt-hour without economic subsidies." In short, it offers a new range of opportunities to reuse waste heat.
To give an idea of how transformative recovering waste heat can be, Zdankiewicz explains that if “280,000 megawttas per hour lost as waste heat were recovered as usable, emission-free electrical power, it could slash greenhouse gas emissions by 20 percent and save $70 to $150 billion per year on energy generation costs, because that waste heat to power is produced from already spent fossil fuels.”
The true challenge, according to Zdankiewicz, is to identify early adaptors of innovative technologies and to provide them with incentives. This provides more conservative customers and industries a way to validate an approach. The payoffs could revolutionize how the industrial and residential markets consume energy.
“Independent data suggest that the waste heat recovery opportunity is equivalent to 20 percent of total U.S. power generation capacity, which is estimated at 280,000 megawatts and valued at over $600 billion," he says.
“The largest players in power recognize that this is an underserved market," he adds, "and that our sCO2 system is best positioned to capture the opportunity.”