New Energy Program Could Aid Spread of 'Green' Power in Nevada
Sep 30 - Las Vegas Review-Journal
Sep. 30--Nevada regulators on Wednesday removed a roadblock that was stalling development of solar, wind and other forms of renewable energy, analysts said.
"It can jump-start what we've been trying do along the way," said
state Sen. Randolph Townsend, chairman of the Senate Commerce Committee.
He pushed through legislation in 2001 that requires utilities to obtain
increasing portions of their power from renewable sources, such as wind, solar
and hot underground water.
It required the utilities to obtain 5 percent of their power from renewable
resources last year, but Nevada Power failed to comply when power developers
fell behind schedule and dropped projects that would have provided power to the
utility.
Some "green" power developers complained that they were unable to
get financing for the projects because investors and lenders feared that Nevada
Power and Sierra might file for bankruptcy and cancel the power supply
contracts.
Townsend said he thinks the resolution will help get green power projects
built. He also said green power can give Nevada more energy independence by
lessening its reliance on conventional fuels.
"Do we want to be dependent on $50 (a barrel) oil which, as you know,
drives up the price of gas, drives up the price of coal?" Townsend said.
"(Nevadans) want to control their own destiny."
Richard Burdette, Gov. Kenny Guinn's energy adviser, led efforts to find a
solution to the green power problem, winning support from interested parties for
establishment of a trust.
The TRED trust will pay renewable-energy plant owners, rather than the
utilities, for green power. That could protect green power plant owners if the
utilities file for bankruptcy.
In addition, the rules call for the utilities to provide a few million
dollars in reserve that can be kept as a backup source of contract payment.
As a result of the program, Burdette hopes the utilities will be getting 9
percent of their power from renewable resources by 2007, which state law
requires by that date. The program is designed to end after the utilities become
strong financially.
"The governor is very pleased," Burdette said. "It gives us a
way to enforce the law that the state Legislature passed and the governor signed
a couple of years ago."
Jon Wellinghoff, an energy attorney with Beckley Singleton, said: "I
think it will be something that will help a number of developers that otherwise
would have difficulty getting financing."
Others, such as Ormat of Sparks, don't need the help, he said. Ormat is
expanding some of its geothermal plants in Northern Nevada and intends to sell
the power to Sierra Pacific Power, Wellinghoff explained.
Burdette mentioned three developers who earlier contracted with the utilities
and want to participate in the program. They are Ely Wind; Solargenix, which is
developing a 50-megawatt solar power project in the Eldorado Valley near Boulder
City; and Earth Power Resources, which is developing a geothermal project in
Elko County.
Tim Carlson, general partner of Ely Wind, said he hopes to complete his
50-megawatt wind farm near Ely by 2006, a year ahead of schedule, because of the
program. The project will feature 33 wind turbines that convert wind power into
electricity.
His partnership's financial advisers, Babcock & Brown of San Francisco,
helped write the rules for the program. They will be seeking money from
investors interested in the project and may invest their own money as well, he
said.
Townsend, chairman of the Legislative Commission, said the rules are
noncontroversial and probably will become final without a Legislative Commission
meeting. During the Legislative session next year, he wants to make the rule a
law, giving lenders and investors more confidence that it will not be changed.
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