Wind Energy Weekly #689, Vol 15, 18 March 1996
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The following is the electronic edition of WIND ENERGY WEEKLY,
Vol. 15, #689, 18 March 1996, published by the American Wind
Energy Association. The full text of the WEEKLY is available
in hardcopy form for $595/year and is recommended for those with
a serious commercial interest in wind (the electronic edition
contains only excerpts). A monthly hardcopy publication, the
WINDLETTER, more suitable for those interested in residential
wind systems is included with a $50/year individual membership in
the Association. AWEA's goal is to promote wind energy as a
clean and environmentally superior source of electricity. Anyone
sharing this goal is invited to become a member. For more
information on the Association, contact AWEA, 122 C Street, NW,
4th Floor, Washington, DC 20001, USA, phone (202) 383-2500, fax
(202) 383-2505, email windmail@mcimail.com. Or visit our World
Wide Web site at http://www.econet.org/awea
_________________________________________________________________
The electronic edition of Wind Energy Weekly will not be
published during the next two weeks due to Windpower '96 and
vacation. We will return to publication during the week of July
8.
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ENERGY OUTLOOK
Book says climate change will hurt financial world
ENERGY POLICY
Canadian tax policies could level field for renewables
TRADE NEWS
NREL program to yield next generation of turbines
INSURANCE GROUPS, GREENPEACE TAKE
AIM AT CLIMATE CHANGE ACTION
The financial community, business leaders, and
environmentalists have a common stake in studying and responding
to the impacts of global climate change, the environmental group
Greenpeace said March 7 in announcing the publication of a new
book on the subject, CLIMATE CHANGE AND THE FINANCIAL SECTOR: THE
EMERGING THREAT, THE SOLAR SOLUTION.
Greenpeace, better known for its confrontational
demonstrations and media events, has opted in the case of climate
change for a long-running dialogue over the past few years with
leaders of the insurance industry and other investment groups,
and the book is a part of that activity.
Edited by Greenpeace's Dr. Jeremy Leggett and published by
Gerling Group, one of Germany's premier insurance concerns,
CLIMATE CHANGE AND THE FINANCIAL SECTOR, Greenpeace said in a
news release, "shows clearly--from the standpoint of financial
insiders--that climate change caused by overconsumption of fossil
fuels threatens the stability of the world's financial
institutions." The book goes on to prescribe clean, renewable
energy sources like solar and wind as the means of achieving
future prosperity and stability.
Among the book's contributors is Robert Kelly, Co-Chairman
of U.S.-based solar photovoltaics manufacturer Amoco/Enron Solar.
"I believe there is a significant global market for solar power.
. . As the efforts of the world to deal with sustainability
increase, solar power will make a larger and larger contribution,
taking the world through the fourth millennium," Kelly said.
The independent Intergovernmental Panel on Climate Change
(IPCC), a large United Nations-sponsored group of experts
investigating the issue, has stated that if fossil fuel
greenhouse gas emissions continue at anywhere near current
levels, the planet will warm up dangerously, and could well
experience a devastating increase in the frequency and intensity
of so-called natural disasters. At a news conference in New
York, Leggett, Director of Greenpeace International's Solar
Initiative, said financial industries are waking up to this
threat.
"Believing that a healthy environment and strong economy go
hand in hand, Greenpeace has forged links with major insurance
and reinsurance companies, banks and investment firms throughout
the world," Leggett said. "We recognize our shared interests and
are calling on governments to take stronger measures now to cut
the release of C02 into the atmosphere."
Another contributor, Greenpeace said, may have summed up the
issue best. Carlos Joly, a senior vice president at UNI
Storebrand of Norway, wrote, "What does it do us to cash in
investments twenty years from now if the world goes to hell
partly as a result of what we invest in?"
One of the central obstacles to taking action on climate
change, Joly noted at the news conference, is that there are not
yet established markets that can absorb the type of large
financial investments that the insurance community would be in a
position to make. UNI Storebrand, he said, plans to roll out an
"environmental value" fund in May that will invest in companies
based on environmental criteria. Commented Joly, "It's not
enough to give a good return--we have to take responsibility for
taking care of some of the quality-of-life conditions our pension
fund holders will be living in [in the future.]"
Other contributors to CLIMATE CHANGE AND THE FINANCIAL
SECTOR include representatives of the Reinsurance Association of
America, Gerling Group, General Accident (UK), Union Bank of
Switzerland and National Westminster Bank (UK and US).
Timothy Wirth, U.S. Under Secretary of State for Global
Affairs says, "CLIMATE CHANGE AND THE FINANCIAL SECTOR [is] . . .
an important step forward . . . [that] needs to be considered by
the financial community everywhere--especially in the United
States."
CANWEA SEES PROGRESS ON
TAX TREATMENT OF RENEWABLES
The Canadian Wind Energy Association (CanWEA) hailed the
proposed budget of Finance Minister Paul Martin March 7, saying
it "respond[s] favorably to requests by the renewable energy and
independent power sectors that the tax treatment of renewable
energy be put on an equal footing with the oil and gas sector."
The proposed budget would make it possible for businesses to
write off the cost of installing renewable energy systems, and
also to deduct the cost of related intangible expenses such as
feasibility studies.
"The government, through this budget, has made great strides
toward rectifying major impediments to the development of
competitive sources of renewable energy," says Fred Gallagher, a
member of the stakeholder task force that requested the changes.
"Officials in the department of finance and their colleagues
at NRCan [Natural Resources Canada] are to be congratulated for
responding to industry requests that the tax playing field in the
energy sector be levelized," said CanWEA President Jeff Passmore
in a news release. "The fact that Ministers Martin and McLellan
and their departments have recognized the importance of renewable
energy and efficiency, and have specifically singled us out in
this budget, not only as a significant contributor to energy
supply, but as a means of reducing CO2 emissions, is a huge step
forward for Canada. Now we can get on with creating the jobs and
the economic wealth that previously this sector has had to leave
undeveloped."
Specifically, the budget proposes to:
- Improve access to financing by relaxing the "specified
energy property" rule of the Class 43.1 Capital Cost
Allowance (CCA) and expanding eligibility for flow-through
shares. This will permit corporations whose principal
business is manufacturing and processing or mining to claim
CCA deductions in respect of such property against income
from all sources. The "specified energy property" rule was
put in place in 1988 and has limited the use of the CCA to
corporations whose principal business was in the energy
sector, or to taxpayers who used the property in their own
business.
- Make the tax treatment of renewable and non-renewable energy
sectors more similar by introducing Canadian Renewable and
Conservation Expenses (CRCE) which are similar to the
intangible costs claimed by the non-renewable sector as
Canadian Exploration Expenses (CEE). These expenses will be
fully deductible and will be able to be flowed through to
shareholders. This will allow improved access to financing
in the early stages of operations when there may be little
or no income to utilize these expenses against. The CRCE
will include expenses such as feasibility studies and
pre-construction development expenses.
"Finance has opened the door and it will be interesting to
see how the market reacts," Passmore said. "Manufacturing and
processing businesses will need to develop an investment interest
in something beyond their main line of business.
"We look forward to working with the Department of Finance
and NRCan officials to define which expenditures will be eligible
under CRCE. Obviously we will be looking to achieve comparable
treatment to other exploration and development expenses allowable
within the energy sector."
For further information, contact the Canadian Wind Energy
Association National Office, 100, 3553 - 31 Street NW, Calgary,
Alberta, CANADA T2L 2K7, phone 800-9-CANWEA or (403) 289-7713
outside Canada, e-mail canwea@eworld.com
NEXT GENERATION TURBINES
USE INNOVATIVE CONCEPTS
The National Renewable Energy Laboratory (NREL) has released
some details on the wind turbine designs for which awards have
been issued under its Next Generation Turbine Development (NGTD)
Project, and on the innovative ideas the contractors propose to
incorporate.
More than a dozen companies were selected to develop
preliminary designs in the NGTD program. Of those, three--Zond
Systems, of Tehachapi, Calif., The Wind Turbine Company, of
Bellevue, Wash., and Kenetech Windpower, of Livermore, Calif.--
have been awarded cost-shared funding to fabricate turbines. The
objective of the NGTD program is to lead to wind systems that can
produce electricity for 4 cents/kWh or less at a site with an
average wind speed of 13 mph (5.8 m/s) by the 1998-2000 time
frame.
The Zond Systems Z-56 is an upwind, variable-speed,
variable-pitch turbine with a rotor diameter of 56 meters rated
at an output of 1.078 MW. According to an NREL information
sheet, "it employs the same general architecture as Zond's Z-40PS
turbine and achieves a lower cost of energy as a result of its
innovative features and economies of scale." Current plans call
for the machine to use the following advances: NREL-designed
airfoils; a variable-speed, doubly-fed generator; and a
distributed-intelligence controller.
The Wind Turbine Company's WTC-1000, also a 1-MW unit, would
have a rotor diameter of 54.3 meters (current design data for all
machines are subject to change). The WTC-1000 is a downwind
turbine that "incorporates variable coning to attenuate loads"
and a drive train that employs multiple generators, NREL said.
In addition to variable coning, the turbine's innovations include
a 100-meter tower with internal lift and resin-transfer-molded
blades.
The Kenetech KVS-50 is an upwind, variable speed, variable-
pitch, direct-drive turbine rated at 650 kW capacity. Like the
Zond unit, it would be similar in architecture to the company's
smaller existing variable-speed machines, the KVS-33 and KVS-45.
Besides direct drive, the unit will include individual blade
pitch control and adaptive control algorithms.
In the second phase of the NGTD program, Prototype
Development, which is proceeding now, each company will design,
fabricate and test a proof-of-concept turbine to demonstrate new
components and subsystems, confirm aerodynamic performance, and
validate computer models. Test results will be used by engineers
to develop design improvements for engineering prototype turbines
to be built by each company.
For further information, contact Paul Migliore, NREL, 1617
Cole Boulevard, Golden, CO 80401, USA.
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