EERE: 20% Wind Power and 500 Industrial Energy Assessments

A weekly newsletter from the U.S. Department of Energy's (DOE) Office of Energy Efficiency and Renewable Energy (EERE). The EERE Network News is also available on the Web at: www.eere.energy.gov/news/enn.cfm May 14, 2008 News and Events New DOE Report Analyzes a Path to 20% Wind Power by 2030 U.S. Wind Power Still Growing at a Record Pace, Says AWEA DOE Chalks Up 500 Energy Saving Assessments at Major Industries Long Island Utility to Launch a 10-Year Energy Efficiency Program Nissan to Sell an Electric Vehicle in the United States in 2010 Minnesota to Require 20% Biodiesel Blends by 2015, with Caveats Energy Connections Oil Producers Head to Deep Water in the Gulf of Mexico

News and Events New DOE Report Analyzes a Path to 20% Wind Power by 2030 Wind power has been growing at a rapid pace in recent years, but to meet the 20% goal, the pace will need to triple by 2017. Enlarge this photo. Credit: Todd Spink Wind power could provide 20% of U.S. electricity needs by 2030, according to a new DOE report. The report, titled "20% Wind Energy by 2030: Increasing Wind Energy's Contribution to U.S. Electricity Supply," identifies the steps that need to be addressed to reach the 20% goal, including reducing the cost of wind technologies, building new transmission infrastructure, and enhancing domestic manufacturing capability. Released on Monday, the report was produced by DOE and its National Renewable Energy Laboratory, Lawrence Berkeley National Laboratory, and Sandia National Laboratories with the assistance of the American Wind Energy Association (AWEA), engineering consultants from Black and Veatch Corporation, and more than 50 energy organizations and corporation. According to the report, reaching the 20% goal will require boosting wind power from its current generating capacity of 16.8 gigawatts (GW) to 304 GW in 2030, an 18-fold increase. Despite the magnitude of that challenge, most of the report's key findings are encouraging. Notably, the report concludes that 20% wind power can be reliably integrated into the grid at a cost of less than 0.5 cents per kilowatt-hour, which compares favorably to today's average retail price of electricity in the United States, at 8.9 cents per kilowatt-hour. In addition, the demand for copper, fiberglass, and other raw materials needed to build the wind power facilities will not be prohibitive to reaching the 20% goal. However, the report also identifies several challenges that need to be overcome. Achieving 20% wind power by 2030 will require that the annual installations of wind power increase threefold, from today's 2,000 annual turbine installations to almost 7,000 per year by 2017. Also, new transmission lines will need to be installed reach the most productive wind resource sites. But between now and the time the goal is reached, wind power will have avoided the emission of 7.6 gigatons of carbon dioxide, helping to forestall the growth in greenhouse gas emissions from U.S. power plants. The 304 GW of wind power will also continue avoiding 825 million metric tons of carbon dioxide emissions each year thereafter. For comparison, the United States currently emits about 6 billion metric tons of carbon dioxide per year. While helping to address greenhouse gas emissions, the accelerated wind power effort would support roughly 500,000 U.S. jobs while adding more than $1.5 billion in annual revenues to the coffers of local communities. For more information, see the press releases from DOE and AWEA, the 20% Wind Energy by 2030 Web site, DOE's Wind and Hydropower Technologies Program Web site, and the full text of the report (PDF 3.95 MB). Download Adobe Reader. U.S. Wind Power Still Growing at a Record Pace, Says AWEA The U.S. wind energy industry installed 1,400 megawatts (MW) of new wind power capacity during the first quarter of 2008, according to the American Wind Energy Association (AWEA). With more than 4,000 MW of additional wind power capacity now under construction, the industry is on pace to meet or exceed last year's record installed capacity of 5,249 MW (AWEA recently adjusted this number upward from the earlier reported number of 5,244 MW). More than half of the new capacity was built in Texas, including the largest new facility, the 209-MW Roscoe Wind Farm, which was built by Airtricity, Inc. and is located about 50 miles west of Abilene. The largest new facility under construction is the 400-MW Fowler Ridge Wind Farm in Indiana, located 90 miles northwest of Indianapolis. That project and the nearby 130.5-MW Benton County Wind Farm will be the first major wind facilities in Indiana. But despite the wind industry's current breakneck pace and geographical expansion, AWEA warns that construction could stall next year if the production tax credit is not renewed. The tax credit expires at the end of the year and could result in a rush to complete the current projects before the year's end. See the AWEA press release and first-quarter market report (PDF 226 KB). Download Adobe Reader. The AWEA press release also notes that more wind turbine components are now being manufactured in the United States. At least 17 manufacturing facilities were either brought online or expanded in 2007 and early 2008, and over the past three years the percentage of U.S.-made components has increased from less than 30% to more than 50%. That trend looks likely to continue, as Siemens has announced plans to double its wind blade manufacturing capacity in Iowa, while Vestas Wind Systems plans to build a manufacturing plant for wind turbine towers in Colorado. Siemens just opened its Iowa facility in 2007, and the planned expansion will add another 200 jobs at the plant. Likewise, Vestas just opened a wind blade manufacturing plant in Colorado, and is now "resolved to build the world's largest tower factory" in the same state. The factory will require an investment of nearly $150 million, and when it is completed in mid-2010, it will convert 200,000 metric tons of steel into about 900 towers each year, employing about 400 people. See the Siemens press release and page 5 and 6 of Vestas' first-quarter interim financial report (PDF 88 KB). DOE Chalks Up 500 Energy Saving Assessments at Major Industries DOE's Save Energy Now program has completed its 500th Energy Saving Assessment. Since 2006, teams from DOE's Save Energy Now program have analyzed the efficiency of pumps, fans, compressed air systems, and heating and steam systems at 500 of the nation's most energy-intensive industrial facilities. The teams use specifically targeted software to identify cost and energy savings and then train the facility personnel to use the software, so the technology can be applied at other plants. The energy assessments typically show saving opportunities of 5%-15% of each plant's total energy use, and if all those opportunities were pursued, it would yield an average annual savings of about $1.7 million per plant. The 500th assessment was conducted at the Dow Chemical Company in Freeport, Texas. Dow Chemical is a good example of the success of the Save Energy Now program, because assessments were carried out at 16 of Dow Chemical's facilities in 2006 and 2007. The assessments identified $31 million per year in potential savings, and as of April, 13 of those facilities have implemented projects that should yield $7.7 million in annual savings. Additional projects that are now in progress should yield another $7 million in annual energy savings. Altogether, the Energy Saving Assessments in facilities across the country have identified ways to save an estimated 80 trillion Btu of natural gas dash;the amount used by roughly one million U.S. homes. If all of the assessments' recommendations were fully implemented, they could avoid an estimated 7 million metric tons of carbon dioxide emissions annually, while saving more than $800 million in natural gas costs alone. See the DOE press release and the Save Energy Now Web site. Long Island Utility to Launch a 10-Year Energy Efficiency Program The Long Island Power Authority (LIPA) plans to invest nearly a billion dollars in energy efficiency over the next 10 years under its new Efficiency Long Island program, which was unveiled last week. The $924 million program will start on January 1, 2009, and will offer residential and business customers an array of incentives, rebates, financing options, and other programs to help reduce their energy use. The program will be funded through a modest energy efficiency fee based on electricity use. It will be offset somewhat by a reduction in base rates to remove funding for the energy efficiency portion of LIPA's Clean Energy Initiative, which expires at the end of the year. Over the next decade, Efficiency Long Island is expected to reduce the island's peak demand by 500 megawatts (MW), equal to about one large power plant. For residential customers, the program will encourage the purchase of energy efficient products, the installation of high-efficiency central air conditioning and heat pumps, the application of duct sealing and tune-ups for central air conditioners, and the retrofit of entire homes. The program will also encourage the construction of Energy Star homes and will provide continued support for LIPA's Residential Energy Affordability Partnership, which helps lower-income households reduce their energy bills through energy efficiency. For commercial customers, the program will address energy efficiency in both new and existing buildings. See the LIPA press release and the Efficiency Long Island Web site. New York State as a whole has been supporting energy efficiency through its New York Energy Smart Program, which is funded by a "systems benefit" charge that is added onto customers' bills. Administered by the New York State Energy Research and Development Authority (NYSERDA) since 1998, the program has helped the state achieve $570 million in annual energy savings while reducing peak electrical demand by 650 MW. It has also allowed for an additional 550 MW of short-term load reduction when needed. Over the past decade, the program has saved more than 3 trillion kilowatt-hours of electricity and 4.7 trillion Btu of heating fuels. The state's systems benefit charge was recently extended through mid-2011. See the NYSERDA press release. Nissan to Sell an Electric Vehicle in the United States in 2010 Nissan Motor Company, Ltd., announced yesterday that it plans to introduce an all-electric vehicle in the United States and Japan in 2010. The vehicle will then be mass-marketed to consumers throughout the world in 2012. The company's terse announcement was buried in the press release for its first-quarter financial results, but it marks the first announced plans by a major automaker to mass-market an all-electric vehicle. Currently, the electric vehicle market is being led by relatively small startup companies, such as Zap, Tesla Motors, and Aptera. See the Nissan press release. While Nissan is going all-electric, General Motors Corporation (GM) is developing a plug-in hybrid electric vehicle, the Chevrolet Volt, but the company is also pursuing other fuel-saving measures. Last week, GM allowed journalists to drive its "HCCI-enabled" Saturn Aura, which can run its engine using a traditional spark ignition or using "homogenous charge compression ignition" (HCCI) for fuel savings. HCCI involves igniting a gasoline-air mixture using compression, as in a diesel engine, rather than a spark. The technology burns the fuel evenly throughout the combustion chamber, allowing the engine to run at a lower temperature and resulting in a 15% increase in fuel economy. But the technology is difficult to control, so the Aura only uses HCCI at low speeds. GM introduced the HCCI-enabled Aura last year, but the company is now emphasizing its ability to employ HCCI at idle, which is particularly difficult. GM also announced plans to deploy its V-8 Duramax turbo-diesel engine in its 2010 Chevrolet Silverado and GMC Sierra. The advanced diesel engine will meet emissions standards in all fifty states while cutting fuel consumption by 25%. Precise combustion controls also allow it to run quieter than today's diesel engines. See the GM press releases on the HCCI and diesel engines and the article from this newsletter on last year's HCCI announcement. Meanwhile, Ford Motor Company is achieving greater fuel economy through the use of more efficient six-speed automatic transmissions. The company announced last week that it will double the number of six-speed transmissions in its cars and trucks sold in North America by the end of next year. Compared to four- and five-speed transmission, the advanced six-speed transmissions cut fuel consumption by as much as 6%. A new version of the six-speed transmission will debut in the 2009 Ford Escape, Mercury Mariner, and Mazda Tribute sport utility vehicles, which go on sale this fall, and two other vehicles will follow next year. The transmissions will be built at Ford's Van Dyke Transmission Plant in Sterling Heights, Michigan, doubling the production at that plant. By the end of 2012, 98% of the automatic transmissions that Ford sells in North America will be six-speed transmissions. See the Ford press release. Minnesota to Require 20% Biodiesel Blends by 2015, with Caveats Minnesota Governor Tim Pawlenty signed a bill on Monday that will require all diesel fuel sold in the state for use in internal combustion engines to contain at least 20% biodiesel by May 1, 2015, with several caveats. As the name implies, the Omnibus Agriculture and Veterans Policy Bill spans a great many subjects, including biofuels. Section 51 of the bill gradually increases the state's 2% biodiesel mandate to 5% on May 1, 2009, then 10% on May 1, 2012, and then to 20% on May 1, 2015. However, the increases to 10% and 20% biodiesel do not apply during the cooler months of November through March, when the standard will revert to 5% biodiesel, unless the state commissioners of agriculture, commerce, and pollution find that the technical issues associated with using 10% or 20% blends in cold weather have been addressed (if not properly blended for cold weather, blends containing more biodiesel can gel on cold winter days). Those increases also depend on several conditions that the state commissioners must evaluate, namely, there must be an industry specification or federal standard for each blend; a sufficient supply of biodiesel, with at least half produced in the state, using mainly feedstocks produced in the United States or Canada (barring weather-related complications); an adequate blending infrastructure and regulatory protocol; and a supply of at least 5% of the biodiesel from non-traditional feedstocks, such algae, waste oils, or tallow (unless it is uneconomic to do so). The state commissioner of commerce can temporarily suspend the biodiesel requirements if there is a supply or quality problem, or if regional price disparities would cause economic hardship to the state's diesel fuel retailers. The bill also exempts several limited uses of diesel fuel and prohibits the production of biodiesel from palm oil, except when the palm oil is in recycled waste oil. See the press release from the National Biodiesel Board and read the new fact sheet on biodiesel blends from DOE's Alternative Fuels Data Center (PDF 272 KB). Download Adobe Reader. To support the biodiesel requirements of the bill, Section 72 allows up to $300,000 in state bioenergy grants to go toward infrastructure improvements for blending biodiesel for use in cold weather. In addition, Section 69 requires the state commissioners to provide recommendations to the NextGen Energy Board and to the legislature on the potential use of biobased alternatives to diesel fuel. This may include diesel-like fuels produced from plant or animal byproducts through thermal or chemical processes. The NextGen Energy Board generates recommendations on how the state should invest its resources in renewable technologies to help achieve energy independence. Section 21 of the act defers the expiration of the NextGen Energy Board until mid-2014. See the full text of the bill.

Energy Connections Oil Producers Head to Deep Water in the Gulf of Mexico As oil prices continue to hit new record highs, a new report from the Interior Department's Minerals Management Service (MMS) documents a steady advance of oil producers into deeper waters in the Gulf of Mexico. The report, "Deepwater Gulf of Mexico 2008: America's Offshore Energy Frontier," notes that 72% of the Gulf oil production is now coming from wells drilled in 1,000 feet or more of water. Ten deepwater well started production in 2006 and another 15 started production in 2007. And of 48 development wells drilled in 2007, 60% were in "ultra-deep water," which is defined as water depths greater than 5,000 feet. Eight new deep water discoveries were announced in 2007, three of which were in ultra-deep water, with the deepest located in 7,400 feet of water. See the MMS press release and the full report (PDF 9.1 MB). Download Adobe Reader. How will these deep-water facilities cope with hurricanes? Petrobas, a Brazilian oil company, plans to develop a floating oil and natural gas facility that will draw from a well drilled in 8,200 feet of water. The facility will be able to disconnect from its wells and pipelines and move out of the path of approaching storms. It will be the first production facility to take advantage of significant oil and gas resources discovered in a geologic region known as the Lower Tertiary trend, which located in the ultra-deep water of the Gulf. See the MMS press release.

This newsletter is funded by DOE's Office of Energy Efficiency and Renewable Energy (EERE) and is also available on the EERE Web site. You can subscribe to the EERE Network News using our simple online form. If you have questions or comments about this newsletter, please contact the editor, Kevin Eber.