eenergy efficiency & clean energy

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EEnneerrggyyiinnFFlloorriiddaa

FortheFloridaEnergyandClimateCommission

By

TheFloridaEnergySystemsConsortium

Dr.JulieHarrington,DirectorDr.BassamAwad

ZafarSiddiquiDavidGlassner

StephenMuscarella

CenterforEconomicForecastingandAnalysis(CEFA)FloridaStateUniversity

TedKury,Director,EnergyStudiesAchalaAcharya

TheUFPublicUtilityResearchCenter(PURC)UniversityofFlorida

ErikSander,AssociateDirectorTheFloridaEnergySystemsConsortium(FESC)

JackSullivanJr.Dr.AsterR.Adams

March22,2010


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Acknowledgments:

Theauthorswould liketothanktheDirectoroftheUniversityofCentralFloridaVentureLab,

KirstieChadwick,and theDirectoroftheUniversityofFloridaOfficeofTechnologyLicensing,

DavidDay,fortheirassistancerelatingtoventurecapital(VC)companiesinFlorida.Theauthors

would liketoextendthankstoSenaBlack,ofEnterpriseFlorida, forproviding informationon

FloridasOpportunityFund. Inaddition, theauthorsaregrateful toMarkFutrellandWalter

Clemence,ofthePublicServiceCommission(PSC),andtoBuckMartinez,ofFloridaPowerand

Light(FP&L),forprovidingclarificationonissuesrelatingtoFlorida.


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TableofContents

Acknowledgments:.................................................................................................................. 1

Introduction ............................................................................................................................ 7DefinitionsofRenewableEnergy,CleanEnergy,CleantechandEnergyEfficiency ................................. 9RenewableEnergyinFlorida .................................................................................................................... 9

CleanEnergyandCleantech................................................................................................................... 10EnergyEfficiency..................................................................................................................................... 12EconomicCostsandBenefitsofCleanEnergyinFlorida........................................................................ 13

CurrentIncentivesMix .......................................................................................................... 17InventoryofEconomicIncentivesThatImpacttheCleanEnergySectorinFlorida............................... 17TotalStateFundsAllocatedtoEachIncentiveandtheIncentivesAnnualUse .................................... 20FederalIncentivesforFlorida................................................................................................................. 25FloridaEnergyEfficiencyandConservationAct(Section366.82).......................................................... 28EnergyEfficiencyandRenewableEnergyIncentivesinCleanEnergyJobsandAmericanPowerAct2009........................................................................................................................................................ 28

Section161:RenewableEnergy .................................................................................................... 29

Section162:AdvancedBiofuels .................................................................................................... 29EnergyEfficiencyTargets................................................................................................................ 30

ProgramsOfferedbyLocalUtilities,Cities,andCounties...................................................................... 31

CommercialIncentives ............................................................................................................... 31

BarrierstoCommercializationandProjectFinance................................................................ 34MainBarrierstoCleantechCommercializationandProjectFinance..................................................... 42

PerceivedHighRiskofCleantechBusinesses .............................................................................. 42InsufficientInvestmentsinR&D .................................................................................................... 42OtherBarrierstoCleantechCommercializationandProjectFinance...................................... 48

CleanTechnologyLifeCycleandFundingSources................................................................................. 49

ResearchMethodology................................................................................................................... 49CurrentSituationandRelativePerformanceMetrics ................................................................ 50StateofAffairs:FloridaVentureCapitalCommunity............................................................................. 64

AssetFinanceBeyondCapitalMarkets,VentureCapital,PrivateandPublicEquity,andDebtandPrivateCapital................................................................................................................. 75

PublicBenefitFund................................................................................................................................. 76PropertyAssessedCleanEnergy(PACE)&EnergyFinancingDistrictsModels ..................................... 78

RegulatoryChanges............................................................................................................... 91TheRPSandItsEconomicImpact........................................................................................................... 91AnRPSforFlorida................................................................................................................................... 94PolicyConsiderationsforFloridaRecentDevelopments ..................................................................... 97

ConclusionsandRecommendations .................................................................................... 100Task1.................................................................................................................................................... 104Task2.................................................................................................................................................... 108Task3.................................................................................................................................................... 110Task4.................................................................................................................................................... 113Task5.................................................................................................................................................... 116

References........................................................................................................................... 122


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Appendices.......................................................................................................................... 131AppendixA:Tables ............................................................................................................................... 131AppendixB:FederalCleantechIncentivesThrough2009.................................................................... 231AppendixC:CleantechIncentiveProgramsOfferedbytheStateofFlorida ....................................... 233AppendixD:LeadingPublicFinancingToolsandMechanisms............................................................ 235AppendixE:ExpectationsofCleantechDevelopers............................................................................. 237

AppendixF:Energy

Recovery

Stimulus

Grant

Awardees

by

State ....................................................... 240AppendixG:PACEModel...................................................................................................................... 274

AppendixH:EconomicImpactandSuccessStories ............................................................................. 277AppendixI:FreeingtheFloridaGrid2009............................................................................................ 282AppendixJ:FederalLoanGuarantee.................................................................................................... 283AppendixK:EconomicDevelopmentStudyScopingDocument.......................................................... 289

ListofTablesTable1.CleanEnergyRelatedIndustriesListofNAICS .............................................................................. 11Table2.RenewableTechnologyCostsforU.S............................................................................................ 14Table3.RenewableTechnologyEstimatedEconomicImpactsforFlorida ................................................ 14Table4.InventoryofIncentivesThatImpacttheCleanEnergySectorinFlorida...................................... 19Table5.RemainingBalancesasofJanuary29,2010ofRenewableTaxCredits/SalesTaxRefunds ......... 22Table6.RenewableEnergyTechnologiesGrantsProgram ........................................................................ 23Table7.SolarEnergySystemIncentivesProgram(SolarRebate).............................................................. 24Table8.EconomicImpactofStateIncentivesinTermsofJobsCreated ................................................... 24Table9.CleanTechnologies........................................................................................................................ 35Table10.CleantechSubsectorsTrackedbyCleantechVentureNetworkandtheTypesofCleantechBusinesses................................................................................................................................................... 35Table11.CurrentSituationandRelativePerformanceMetrics................................................................. 50Table12.TopStateswithCleanEnergyPatents......................................................................................... 55Table13.TopStatesReceivingSBIRandSTTRFundsforCleanEnergyTechnologies20002008............. 57Table14.TopStatesCleantechVCDeals20002009($Millions) ............................................................ 61

Table15.TopStatesReceivingVCFundingforEarlyCapitalStage($Millions,SelectedYears) ............... 62Table16.TopStatesReceivingVCFundingforMid/LateCapitalStage($Millions,SelectedYears)......... 66Table17.HistoricalGrowthRatesofCTIUS,NEXandS&P500Indices....................................................... 69Table18.TopStateswithMostARRACleantechFunding.......................................................................... 84Table19.TopStateswithMostSmartGridInvestmentGrants................................................................. 85Table20.TopStateswithMostElectricDriveVehicleBatteryGrants....................................................... 86Table21.TopStateswithMostBiomassGrants ........................................................................................ 86Table22.TopStateswithMostGeothermalGrants .................................................................................. 87Table23.ARRAFundingforBreakthroughProjects($Millions) ............................................................... 87Table24.TopStateswithMostSBIR/STTRCleantechGrants .................................................................... 88Table25.SummaryTableofFloridasCurrentSituationandAchievementGap ....................................... 88

Table26.SummaryofStateIndustrialIncentivePrograms ....................................................................... 95Table27.CurrentIncentiveProgramsandRecommendations................................................................ 105Table28.IncentiveProgramsandTheirAvailabilityinFlorida................................................................. 110Table29.ProsandConsofEachPortfolioofProgramsToDecreaseBarriersTotheCommercializationoftheCleanTechnologySector .................................................................................................................... 111Table30.RenewablePortfolioStandardsbyState................................................................................... 131Table31.FederalIncentivesthatImpactCleanEnergyinFlorida............................................................ 132Table32.ProgramsOfferedbyLocalUtilities,Cities,andCounties......................................................... 135Table33.FloridaProjectsFundedthroughARRA2009............................................................................ 137


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Table34.TotalSBIR/STTRAwards,AllAgencies,AllTechnologies,20002008 ....................................... 141Table35.TotalSBIR/STTRAwards,AllAgencies,AllTechnologies,2008................................................. 142Table36.TotalSBIR/STTRAwards,AllAgencies,CleanEnergyTechnologies,20002008 ...................... 143Table37.NVCA:VentureCapitalInvestmentsbyState2000to2008($Millions).................................. 144Table38.NVCACapitalUnderManagementbyState2000to2008($Millions) .................................. 145Table39.VentureCapitalFundCommitments20002008(Millions).................................................... 146

Table

40.

Progress

of

States

in

Attaining

RPS ........................................................................................... 147Table41.RetailSalesofElectricitybyState20002007TotalElectricIndustry....................................... 148Table42.ListofStateswithanAngelTaxCreditProgram....................................................................... 150Table43.RenewablePortfolioStandardsbyStateAsofNovember2009............................................... 151Table44.RenewablePortfolioStandards:NotesbyState....................................................................... 152Table45.DowJonesVentureSource:TotalVentureCapitalbyStatefor20002009($Millions).......... 154Table46.DowJonesVentureSource:VCinMidLateStage*byStatefor20002009($Millions)........ 155Table47.DowJonesVentureSource:VCinEarlyStage*byStatefor20002009($Millions) ............... 156Table48.AngelGroupsbyStatewithAngelITCProgramsNotedfromNGAData(Circa2007) ............. 157Table49.StateAngelInvestmentTaxCredits .......................................................................................... 158Table50.SelectStateIncentivesforRenewableEnergy,November2009.............................................. 160Table51.StatePublicBenefitsFundsforRenewables(May2009EstimatedFunding) .......................... 161

Table52.CenterforVentureResearch,AngelActivityintheUS20012009........................................... 162Table53.StateSupportedVCFundsfromtheNASVF.............................................................................. 163Table54.U.S.StateSupportedVentureCapitalFunds:NationalAssociationofSeedandVentureFunds(NASVF)March2008................................................................................................................................. 165Table55.ARRA09Awards:VariousProgramsbyState ........................................................................... 167Table56.CleantechnologyInvestmentsbyYear..................................................................................... 169Table57.CleantechNetworkDealFlowfrom20002009:AllStagesofFinancingandAllCleantechIndustries .................................................................................................................................................. 171Table58.CleantechNetworkDealFlowfrom20002009:SeedandEarlyStageFunding,EnergyIndustries .................................................................................................................................................. 171Table59.CleantechNetworkDealFlowfrom20002009:Mid+StageFinancing,EnergyIndustry..... 172

Table60.CleantechNetworkDealFlowfrom20002009:SeedandEarlyStageFunding,EnvironmentalIndustries .................................................................................................................................................. 173Table61.CleantechNetworkDealFlowfrom20002009:Mid+StageFunding,EnvironmentalIndustries .................................................................................................................................................. 175Table62.CleantechNetworkDealFlowfrom20002009:SeedandEarlyStageFunding,IndustrialActivities.................................................................................................................................................... 175Table63.CleantechNetworkDealFlowfrom20002009:Mid+StageFunding,IndustrialActivities..176Table64.LevelizedCostofEnergyKeyAssumptions ............................................................................178Table65.ScienceAndEngineeringProfiles,byState(20062008)..........................................................179Table66.ElectricEnergyPricebyStateRevenueperKilowattHour(Cents)........................................181Table67.EIA:StateEnergyRankingsSeptember2009 ............................................................................182Table68.EnergyResources:MatrixofApplications................................................................................. 183Table69.EIA,19902007ExistingNameplateCapacitybyEnergySourceandState(SumofNAMEPLATECAPACITY(Megawatts))(EIA860):TotalElectricPowerIndustry........................................................... 184Table70.EIANameplateCapacityforCarbonFuelsinMWfortheTotalElectricPowerIndustry(20002007) ......................................................................................................................................................... 189Table71.EIANetGenerationbyStatebyPowerSourceforAllProducers(20002007)......................... 190Table72.EIANetGenerationbyStateForCarbonFuelSourcesforAllProducers(20002007)............. 197Table73.EIANetGenerationbyStateForHydroelectricSourcesforAllProducers(20002007) .......... 199Table74.EIANetGenerationbyStateForNuclearforAllProducers(20002007) ................................. 200Table75.EIANetGenerationbyStateForNonHydroRenewablesforAllProducers(20002007) .......201


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Table76.ARPAE..................................................................................................................................... 202Table77.GapAnalysis,FLvs.Top4:Startups .......................................................................................... 203Table78.GapAnalysis,FLvsTop4:ActiveLicensesandOptions(ACTLIC) ............................................. 204Table79.UtilityPatents:grantedbytheU.S.PatentandTrademarkOffice ........................................... 205Table80.GapAnalysis,FLvsTop4:AcademicPatentApplications ........................................................ 206Table81.GapAnalysis,FLvsTop4:Disclosures ...................................................................................... 207

Table

82.

Academic

R&D

Expenditures..................................................................................................... 208Table83.NSFResearchbyStateinDisciplinesw/CleantechImplications,2008.................................... 209Table84.ScientistandEngineersPlottedAgainstR&DfortopR&DStates ............................................ 210Table85.PhDScientistsandEngineersEmployedbyState ..................................................................... 212Table86.VentureCapitalFirmsListedin"CapitalVector"Database ...................................................... 212Table87.GapAnalysis,FLvsTop4:AcademicLicensingManagersbyState.......................................... 214Table88.GapAnalysis,FLvsTop4:PatentExpensestoProtectAcademicIntellectualProperty ......... 215Table89.AcademicFacultyandStudents:DataBuiltbyInstitutionfromCarnegieFoundationforPreviousFRCReport.................................................................................................................................. 216Table90.RenewablePortfolioStandardsbyState:RPSRequirement(%ofTotalElectricLoad)........... 217Table91.PrivateEquityBackedMergersandAcquisitionsbyYear($Millions) ...................................... 219Table92.PrivateEquityBackedAcquisitionsbyIndustry(20002008) ................................................... 220

Table93.VentureBackedIPO's,TotalOfferingSize($Millions) ............................................................. 221Table94.VentureBackedIPO's................................................................................................................ 222Table95.HistoricalCleanEnergyPatentsbyState .................................................................................. 223Table96.CapacityAdded,AllProducerforNonHyrdroRenewables(20002009)................................. 224Table97.CapacityAdded,AllProducersforCarbonFuelSources(20002009)...................................... 225Table98.CapacityAdded,AllProducersforHydroSources(20002009)................................................ 226Table99.CapacityAdded,AllProducersforAllFuelSources(20002009).............................................. 227Table100.CapacityAdditionsforNonHydroRenewables,SouthernCo,ProgressEnergy,TECO,FP&LGroup ........................................................................................................................................................ 229Table101.CapitalExpendituresatShareholderOwnedPublicUtilities($Billion)*............................... 230Table102.EmploymentinNewJerseysGreenIndustries:AverageAnnualEmployment,2009............ 280

Table103.FreeingtheFloridaGrid2009 ................................................................................................. 282

ListofFiguresFigure1.StagesofTechnologyDevelopment ............................................................................................ 37Figure2.MainProvidersofFinanceatEachStage..................................................................................... 39Figure3.TheCapitalandSkillsGapforCleantechandCleanEnergyInfrastructureProjectDevelopments............................................................................................................................................. 39Figure4.SequentialModelofDevelopmentandFunding......................................................................... 40Figure5.ValleyofDeath,fromInventiontoInnovation ............................................................................ 41Figure6.EquityGapatEachStageofDevelopment .................................................................................. 41Figure7.ComparisonofUSAGovernmentIncentivesforEnergyDevelopment,19502006.................... 46

Figure

8.

Federal

Subsidies

to

Fossil

Fuels.................................................................................................. 47Figure9.U.S.VCandPrivateEquityInvestmentinRenewableEnergyTechnologyCompanies,20012008($Millions) .................................................................................................................................................. 59Figure10.U.S.VCInvestmentsinCleantech:19952007(MillionConstant2005U.S.Dollars) ................ 60Figure11.TotalVCInvestmentsinNY,FLandNH,20002009($Millions) ............................................... 61Figure12.CleantechVCInvestmentsinTX,FLandMI,20002009($Millions) ........................................ 62Figure13.VCInvestmentsinEarlyStageInTX,FLandOH,20002009($Millions).................................. 63Figure14.VCInvestmentsInMid/LateStageForNY,FLAndOH,20002009($Millions)........................ 67Figure15.CleantechVCInvestmentsanMid/LateCapitalStageInFLandTX,20022009($Millions) ...68


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Figure16.CleantechIndexUSandNEXIndexComparedtoS&P500Index.............................................. 70Figure17.TheSustainableEnergyFinancingContinuum........................................................................... 72Figure18.U.S.RenewableEnergyInvestment........................................................................................... 74Figure19.AssetFinancingNorthAmerica............................................................................................... 74Figure20.RoleofTheU.S.DOEinFinancingCleantech............................................................................. 83Figure21.ImpactsoftheFinancialCrisisandFederalLegislationonRenewableEnergyProject

Development............................................................................................................................................... 84Figure22.VCInvestmentsinFlorida20012009...................................................................................... 170Figure23.WorkingPhDS&EvsR&D:Top20R&DStates(IncludingOutliersCA,MI,NY) ...................... 211Figure24.WorkingPhDS&EvsR&D:Top20R&DStates(ExcludingOutliersCA,MI,NY)...................... 211Figure25.UnitedStatesAnnualAverageWindPower ............................................................................ 228Figure26.FederalLoanGuaranteesforCommercialTechnologyRenewableEnergyGenerationProjectsUndertheFinancialInstitutionPartnershipProgram............................................................................... 283Figure27.FederalLoanGuaranteesforProjectsthatEmployInnovativeEnergyEfficiency,RenewableEnergy,andAdvancedTransmissionandDistributionTechnologies....................................................... 285Figure28.FederalLoanGuaranteesforElectricPowerTransmissionInfrastructureInvestmentProjects.................................................................................................................................................................. 287


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IntroductionCleanenergyisthefuture.Duetoincreasingenvironmentalconcerns,fluctuatingfossil

fuel prices and rising public awareness and interest in renewable energy, both globally and

domestically,countries,statesandmunicipalgovernments,andprivateandnonprofitentities

aretryingtosteerthemomentumofeconomicdevelopmenttowardscleanerandrenewable

sourcesofenergy.

Florida,likeotherUSstates,isalsoinatransitionstageofhowtobestplantomakethe

shift from traditionalenergy resources to cleantech1.However, theproductionof renewable

energy is currently more cost intensive than conventional energy production methods with

using fossil fuels that are more readily accessible and integrated into the current energy

market,althoughcertainrenewableenergyfieldssuchasphotovoltaicarequicklyapproaching

gridparityinsomepartsofthecountry.Assuch,inordertoincreasetheamountofrenewable

energy sources, incentives and subsidiesmustbeused. Sales taxexclusionsonmaterials for

hydrogencars,investmenttaxcreditsandvariousothermonetaryincentivesareusedtoattract

moreactivitytothemarketofrenewableandcleanenergy.

Totrulyestimatetheimpactofanyregulationonenergyproduction,allpossibleaspects

mustbeexamined.Thepolicyenactedwilldictatehowthemarketresponds.Thelimitationof

any system trying to increase investmentandactivity in the renewableenergy sector ishow

welltheyaresupportedbymarketpowers.Thepossibleoptionsatpresentaretocontinueon

thepathofmonetaryand tax incentives,createa stateRenewablePortfolioStandard (RPS),

enactaFeedinTariff2,andvariousotherprograms.Eachoneoftheseoptionsisspecializedto

varyingtechnologiesandoutcomes.

This study aims to provide a framework or roadmap for the transition to clean and

renewable energy sources, and energy efficiencies, in line with market driven forces. We

conduct a comprehensive review of almost all existing statutory incentives supporting the

deploymentofenergyefficiencyandrenewableenergy inFlorida followedbyadiscussionof

effective mechanisms to overcome barriers to commercialization and project finance, and

finally, with an analysis of the economic impact of a state renewableportfolio standard. In

1Cleantechdefinition:knowledgebasedproductsandservicesthatoptimizetheuseofnaturalresourceswhilereducingecologicalimpactand

adding economic value through lowered costs or improved profitability. See further description on page 10, and in the Barriers toCommercialization sectionofthisreport.2 The City ofGainesville has implemented a FeedInTariff.Other states include Hawaii, Illinois, Indiana, Maine,Massachusetts, Michigan,

Minnesota,NewJersey,NewYork,Oregon,RhodeIsland,Virginia,WashingtonandWisconsin.(http://www.nrel.gov/docs/fy09osti/45549.pdf)


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conclusion,thisprojectaimstoprovideanecessaryfoundationorbaselineforthenextstepin

renewable energy and energy efficiency strategic planning and implementation, along with

somesuggestionsandrecommendations.

The report begins with providing an overview of the definition and description of

renewableenergyandcleantech,ingeneral,withabriefsectiononthecurrentstatusofclean

energyinFlorida.Afterthisintroductorysection,themainbodyofthereportisthenstructured

intofoursections.

ThesecondsectionoutlinesthecurrentincentivesavailableinFloridaandattheFederal

Government level, for the promotion of renewable energy and energy efficiency. In

consultation with the Florida Energy and Climate Commission and Enterprise Florida, we

summarizeFloridascurrentcleanenergyincentives.Welistalleconomicincentivesthataffect

the clean energy sector in Florida along with details about State funds allocated to each

incentive and the incentives annual use. Additionally, we briefly cover each incentives

interaction with similar Federal incentives. We then evaluate the success of the States

investmentinthecleantechsectorandanalyzetheintendedeconomicimpactofeachincentive

program.Weaimtobenchmarktheperformance/impactagainstsimilartypesofprogramsor

programs with similar objectives in other jurisdictions or analogous industries/sectors. In

Florida, there are broad based economic development programs that prequalify the clean

energysector. Weanalyzetheseprogramsandverifytheireffectivenessastohowwellthey

catertocleansectorcompanies.Wealsoidentifyandincludefederal,stateandlocalincentives

targetingthedeploymentofenergyefficiencyand renewableenergyproducts.Attheendof

thissection,wedevelopalistofFloridasincentivesthattargetenergyefficiencyanddemand

sidemanagement. Inorder togiveacomprehensiveandmoreholisticpicture,wecover the

FloridaEnergyEfficiencyandConservationAct(FEECA),theprogramsofferedbylocalutilities,

cities,andcounties,federalincentivesforthedeploymentofenergyefficiencyandrenewable

energyproducts.

Thethirdsectionofthereportcoversbarrierstocommercializationandprojectfinance

forcleantechprojects inFlorida. In thissection,we identifyFloridasuniversity,businessand

financialresourcesandlistbarrierstocommercializingintellectualpropertyanddeployingclean

technologybusinesses.Intheensuingdiscussion,weincorporateanalysisofstagesofresources


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and capital necessary to progress business from inception to fullscale deployment.

Additionally,we identifyanddiscuss theavailabilityof resources foreachstage inFlorida. In

consultationwithFESC,stateincubationnetworks(Public&Private),technologytransferoffices

and early stage industry partnership programs in Florida, we aim to identify and list the

resources that are available to transition clean technology intellectualproperty (IP) into the

market. This section also provides some successful models from other states and aims to

identifychallengesthatareuniquetoFloridaregardingprojectfinancing.

Thefourthsectionofthereportdealswithregulatorychanges.Weprovideananalysis

of the potential economic impact of a renewable portfolio standard (RPS) including aspects

suchasjobcreationinFlorida,growthinstateGDP,andothereconomicfactors.Inaddition,we

provideacomparisonbetweenvarious stateprograms includingabreakdownofRPSamong

differentrenewableenergyindustries/sectors.

Thefinalsectionofthereportencompassestheconclusionsandrecommendations. In

thissection,weprovidesuggestionsandrecommendationstotheFloridaEnergyandClimate

Commission (FECC) in a series of pros and cons in key areas: 1)whether to renew existing

incentives 2) how to target sunsetting incentives to the cleantech area 3) a portfolio of

programs to decrease barriers to cleantech commercialization and project finance, and; 4)

whether to pursue an RPS for Florida and; 5) suggest to the FECC effective demand side

incentives.

DefinitionsofRenewableEnergy,CleanEnergy,CleantechandEnergyEfficiency

RenewableEnergyinFlorida

According to the Florida Legislature, FL HB 7135 defines renewable energy (with

alternativeenergy)as:

"Electrical,mechanical,orthermalenergyproducedfromamethodthatusesoneormoreofthefollowingfuelsorenergysources:ethanol,cellulosicethanol,biobutanol,biodiesel,biomass,biogas,hydrogenfuelcells,oceanenergy,hydrogen,solar,hydro,wind,orgeothermal.Biomassmeansapowersourcethatiscomprisedof,butnotlimitedto,combustibleresiduesorgasesfromforestproductsmanufacturing,waste,byproducts,orproducts fromagriculturalandorchard crops,wasteorcoproductsproductsfrom livestockandpoultryoperations,wasteorbyproductsfromandfood


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processing, urban wood waste, municipal solid waste, municipal liquid wastetreatmentoperations,andlandfillgas."3

CleanEnergyandCleantech

TheRenewableEnergyTrustdefinescleanenergyas"energy from renewablesources

suchasbiomass,wind,orsolarpower.Thegoalofcleanenergyistohavealowenvironmental

impact, with low or zero emissions, and minimal impact on the physical surroundings.

Hydropowercanbedefined as clean energydue to zero emissions,but today'shydropower

oftenhassubstantial impactsonaquaticecosystems.Wasteburningandwoodburningplants

thatcaptureemissionscanbecleanenergygenerators.Fossilfuelsdonotprovidecleanenergy

becauseoftheiremissionsandenvironmentalimpacts."4

From the Japan Video Encyclopedia, clean energy is "the solar energy, wind power,

geothermal energy and coal technology projects underscores Japan's enthusiasm for clean

energyandreducedemissionsofcarbondioxide."5

AccordingtoJesperLindgaardChristensen,6thereseemstobemoreconsensusaround

thetermcleantechnologyorcleantechtoembraceknowledgebasedproductsandservices

that optimize the use of natural resources while reducing ecological impact and adding

economic value through lowered costs or improved profitability. In other words, clean

technologiesare inherentlydesigned to (1)provide superiorperformanceat lowercosts; (2)

reduceoreliminatenegativeecological impact;and(3) improvetheproductiveuseofnatural

resources. Cleantech spans many industries, from alternative forms of energy generation

(including clean energy i.e., renewable and alternative energy technologies) to water

purificationtomaterialsefficientproductiontechniques.

Lookingattheimpactontheenvironment,GreenIdeasdefinesrenewableenergyasan

energy source that, from an Earth perspective, is continually replenished. The renewable

resourcecanbereplenishedatarateequaltoorgreaterthanitsrateofdepletion;i.e.,solar,

wind,geothermalandbiomassresources.7GreenIdeasprovidesashortcutdefinitionofclean

3FloridaLegislatureFLHB7135CHAPTER2008227

4http://masstech.org/cleanenergy/energy/glossaryAtoC.htm

5http://www.mofa.go.jp/j_info/japan/video/pamph.html

6JesperLindgaardChristensen,GreensRushIn?:CleantechVentureCapital InvestmentsProspectsorHype?June2009.SeealsoNewYork

CityInvestmentFund:Cleantech:ANewEngineofEconomicGrowthforNewYorkState,page3,January2007;andForumfortheFuture,2006:CleanCapitalFinancingcleantechnologyfirmsintheUK.7TheinclusionofNuclearenergyinthecleanenergydefinitioniscontroversial.Cleanenergyisenergythatisproducedwithoutburningfossil

fuels. Examples include wind, hydroelectricity and, controversially, nuclear power. The reason for this definition is that Nuclear energy


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energy that summarizes the two points: "energy created from renewable sources with low

environmentalimpact."8

Fromthesedefinitions,cleanenergymusthavethefollowingtwocharacteristics:

1 Ithastoberenewable.

2 Ithasloworzeronegativeimpactontheenvironment.

Thismeansthatitissufficientfortheenergysourcetohavelowenvironmentalimpact

to be considered a clean energy source. However, it is not a sufficient condition to be

determined a renewable resource in order to be categorized as clean energy.9 In order to

provideanoverviewof those industries thatare related tocleanenergy, the following table

provides a detailed list of clean energy industries and associated North American Industrial

ClassificationSystem(NAICS)codes.

Table1.CleanEnergyRelatedIndustriesListofNAICSIndustry NAICSCode NAICSTitle Includes

Renewableenergy

generation

wind,solar,tidal 221119 OtherElectric/PowerGeneration solar,tidal,wind,other

geothermal 221330 SteamProduction geothermalsteamproduction

wasteincineration 562213 SolidWasteCombustors&Incinerators

biomass 321113 Sawmills cogenerationplantssellingelectricity

322110 PulpMills

322121 PaperMills 100%recycledpaper,mnfwithGreenEcertifiedrenewableenergy

fuelcells/other 335999 AllOtherMiscellaneousElectricalEquipmentManufacturing

fuelcellsandotheralternativeelectricalsources

Renewableenergysystems

transmission/distribution 221122 ElectricPowerDistribution


supportfunctions

design 541712 R&DinPhysical,EngineeringandLifeSciences

engineer 541330 EngineeringServices engineeringconsulting,design,and/orservices

finance 522110 CommercialBanking

522120

Savings

Institutions

522130 CreditUnions

522190 OtherDepositoryCredit

523910 MiscellaneousIntermediation venturecapitalcompanies,investment

produces no greenhouse gas emissions but it still uses uranium (and sometimes plutonium) which is a natural resource like gas and oil.(http://www.ehow.com/about_4579290_nuclearenergyrenewablenonrenewable.html)8http://www.egreenideas.com/glossary.php?group=r

9 Nuclear energy sector will not be included in our overall analysis in this report for the following reasons: despite the absence of

emissions,nucleargeneration,ingeneral,stillproducesradiationasitsbyproduct.Also,intermsoftheCleantechdefinition(s)prevalentinthecurrent Cleantech literature,nuclear power isoftennot included. In addition, for thepurposeof thisproject,detaileddataon renewableenergy/cleanenergywasmorereadilyavailablethandetaileddataonotherCleantechsectors.


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Industry NAICSCode NAICSTitle Includes

clubs


construction

237130 PowerandCommunicationLine/Structures

alternativeenergystructureconstruction

238221 ResidentialPlumbing,Heating,AC solarheatinginstallation

238222 NonresidentialPlumb,HeatingAC solarheatinginstallation

238151 ResidentialGlassandGlazing

238152 NonresidentialGlassandGlazing

238161 ResidentialRoofing

238162 NonresidentialRoofing

238171 ResidentialSiding

238172 NonresidentialSiding

238211 ResidentialElectrical

238212 NonresidentialElectrical

238311 ResidentialDrywall/Insulation

238312 NonresidentialDrywall/Insulation

Biofuels

325199 AllOtherBasicOrganicChemicalMnf

100%biodieselproduction

324199 AllOtherPetroleumMnf purchasingpetrolandblendingwith100%vegetableoiltomakeblend

111110 SoybeanFarming

111120 Oilseed,ExceptSoybean

111150 CornFarming

Energyefficiency

development 541712 (R&Dseeabove)

541420 IndustrialDesignServices

Energyefficiency

335110

Electric

Lamp

Bulb/Parts

Mnf

manufacturing 335121 ResidentialElectricLightingFixtureMnf

Source: Initial Washington Green Economy Industry List E2SHB 2815 Implementation Team May 16, 2008.http://www.labormarketinfo.edd.ca.gov/contentpub/greendigest/wanaicsindustrylist.pdf.

EnergyEfficiency

Inaddition to clean and renewableenergy, theotherareaof interest in this study is

energy efficiency. It can be simply defined as the efficient use of energy. An operational

definitioncanbegivenasUsinglessenergytoprovidethesameservice. 10Itshouldbenoted

thatthereareanumberofperspectivesregardingthedefinitionofenergyefficiency.TheEIA

heldaseriesofworkshopsandfoundthattheparticipantdefinitioncanbethoughtoffromtwo

perspectives:either(1)aserviceperspectiveor(2)amechanistic,strictintensity,perspective.11

Someviewenergyefficiencyasbeingverydifferentfromenergyconservation,andthatenergy

10BerkeleyLaboratories,2009.http://eetd.lbl.gov/ee/ee2.html

11http://www.eia.doe.gov/emeu/efficiency/conf_papers.htm#Energy%20Information%20Administration%20Energy

Efficiency%20Workshop%20Summary%20Papers
http://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdfhttp://www.labormarketinfo.edd.ca.gov/contentpub/GreenDigest/WA-NAICS-Industry-List.pdf


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conservationrelatesprimarilytobehavior.Peoplewithasocialviewofenergyefficiencymight

considertheenergysavingstobeanefficiencygain,whilethosewithamoretechnicalviewof

efficiencywouldclassifythesavingsasconservationratherthanefficiency improvement.12An

example of energy conservation is turning off the light when the room is unoccupied.13

Examplesofenergyefficiencyforthepurposeofourstudyinclude:

1. Marketing,educationandoutreachbigoverlapwithconservationmessage.

2. Lightingreplacingbulbsandlightingsystemswithefficientmodels.

3. Heating, ventilation and air conditioning system (HVAC) retrofit, repair and

replacement.

4. Energyefficientnewconstruction incorporatingenergyefficientdesignconceptsand

thelatestinnovations.

EconomicCostsandBenefitsofCleanEnergyinFlorida

EnergysupplyandproductionisofcriticalimportanceformostFloridians.Florida,and

thenationingeneral,areconcernedwiththestatusofcurrentenergyreserves;basedprimarily

on nonrenewable resources (e.g., fossil fuel (coal and oil) and nuclear power). The

diversification of the nation's energy mix to include renewable resources helps improve: 1)

energy reliability and independence from foreign production 2) greenhouse gas emissions

and/orglobalwarming3)nationalsecurityand;4)longtermenergypricestability.Inaddition

tocleanandrenewableenergy,theotherareaofinterestinthisstudyisenergyefficiency.

Thissectionhighlightsrenewableoralternativeenergytechnologiescurrentlyavailable

inFlorida.ThefollowingtableprovidesasummaryofrenewabletechnologiescostsforFlorida,

asof2009.

12http://www.eia.doe.gov/emeu/efficiency/definition.htm

13Furthermore,Mostofwhatisdefinedasenergyefficiencyisinfactenergyintensity:"Energyintensityistheratioofenergyconsumptionto

somemeasureofdemand forenergy serviceswhatwe callademand indicator.However,atbest,energyintensitymeasuresarea roughsurrogate forenergyefficiency. This isbecause energy intensitymaymask structural andbehavioral changes thatdonot represent "true"efficiencyimprovementssuchasashiftawayfromenergyintensiveindustries."(http://www.eia.doe.gov/emeu/efficiency/definition.htm)


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Table2.RenewableTechnologyCostsforU.S.

Technology

TotalOvernightCost

($/kW)

VariableO&MCost

($mills/kWh)

FixedO&MCost

($/kW)

SolarPV 6,038 0.00 11.68SolarThermal 5,021 0.00 56.78

Biomass 3,766 6.71 64.45

Landfill 2,543 0.01 114.25

Wind 1,923 0.00 30.30Wind(offshore) 3,851 0.00 89.48

Geothermal 1,711 0.00 161.64Hydropower 2,242 2.43 13.63

AdvancedNuclear 3,318 0.49 90.02Source:EnergyInformationAdministration.March2009.AssumptionstotheAnnualEnergyOutlook2009.

Table3.RenewableTechnologyEstimatedEconomicImpactsforFloridaTechnology GSP($Millions) Jobs Income($Millions)

Solar N/A 7.4130/MW N/A

Biomass 1,149* 17,682 687*

Wind N/A 0.712.79/MW N/ASources: Southern Bioenergy Roadmap, Southeast Agriculture & Forestry Energy Resources Alliance (SAFER) UF/IFAS publication:

http://www.saferalliance.net. Economic Impacts of Extending Federal Solar Tax Credits, Solar Energy Research and Education. Foundation(SEREF),http://www.seia.org/galleries/pdf/Navigant%20Consulting%20Report%209.15.08.pdf. *In2007$.

Floridahastwicethesolar insolationofthe largestPVmarketintheworld,Germany.14

ThecapacityforsolarpowerinFloridaisamongthehighestinthecountry.Solarsystemshave

highercapitalstartupcoststhansomeothertechnologies,butthelackoffuelneedsandvery

lowO&Mcostsandrequirementscanoffsetthehigherconstruction (capital)costs.ThesePV

systemsareestimatedtocreateupto30directjobsperMegawatt(MW), leadingto22,500

114,000directjobsthrough2020,dependentontheexpansionofsolaroutput. 15AUSAToday

study found that when consumers were asked about powering their homes with electricity

fromsolarpanels,2%alreadyhadthem,andabout43%oftherespondentsthought itwould

happeninlessthanfiveyears.16

Being the leader in biomass feedstock, Florida has the ability to attract numerous

biomassprojectswith instatefuels,avoidingtheneedandcostofshipping infeedstockfrom

elsewhere. Solid biomass plants can be powered by organic material such as residual

production (wood chips from logging, wheat straw, etc) or purpose grown crops. Florida

currentlyranksfirst inbioenergyfeedstockofsugarcaneandcitrus,forestresiduesandurban

woodwaste.17TheSAFER2007studyreportedthatbiomassprojectsgenerated$1.15billionin

14http://www.greentechmedia.SeeFaireStudy.

15VoteSolarInitiative.www.votesolar.org

16USAToday,July15,2009,citingSolarSurveyStudybyCSAInternational.

17BioenergyatUF/IAFSPowerPoint.August12,2008.MaryDuryea


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output and over 17,500 jobs in Florida18. Longerterm renewable energy sources include

offshorewind,oceancurrentandalgalharvesting forbiomassfeedstockandfuelproduction.

Researchiscurrentlybeingconductedintheseareas,amongothers,inFlorida.

Nuclearenergy isoneof the alternativeenergies inFlorida.The threenuclearplants

(fivetotalunits)inFloridaproducedacombined2.69GWinMarchof2009.19Thisaccountsfor

4%ofthestatestotalenergyconsumption.ProjectedupgradesatthefacilitiesinLevyCounty

willincreaseProgressEnergyFloridasnucleargenerationby2.38GW.FloridaPowerandLight

isprojected toadd2.61GWofnuclearpowergenerationwithupgradesat theSt. Lucieand

TurkeyPointfacilities.20.AdvancednuclearhasavariableO&Mcostof$0.49/kWhandaFixed

O&Mcostof$90.02/kWh.Theaveragecapitalcostis$90.51.21

Given the volatility of recent fossil fuel prices, Floridians are becoming increasingly

aware of the costs of energy consumption in the state. By establishing new clean power

generation systems and investing in demand side management (energy efficient) programs,

utilities(suppliers)andconsumerswillnotonlylessenourimpacttotheenvironmentbutalso

helpwithdampeningFloridas increasingenergydemand. Innovation, investment,andenergy

efficient conservation can help propel the state into becoming a prosperous, selfsufficient

providerofitsowncleanpower.

On June 25, 2008, Governor Charlie Crist signed into law, House Bill 7135, which

requires the Public ServiceCommission todevelop aRenewablePortfolio Standard (RPS)by

February1,2009.Eachelectricityprovider,exceptmunicipalutilitiesand rural cooperatives,

mustsupplyanasyetunspecifiedamountofrenewableenergytoitscustomers.AlthoughHB

7135doesnot specify theRPS target,GovernorCristsExecutiveOrder07127 from July13,

2007 requires utilities to produce at least 20 percent of their electricity from renewable

resources.22However,todate,noRPStargetpolicyhasbeenpassedbytheFloridalegislature.

Therenewableenergy incentives inFloridaencompasscorporate taxcredits,salestax

exemptions,localrebateprograms,loans,industrysupportsandproductionincentives.Florida

18SouthernBioenergyRoadmap,SoutheastAgriculture&ForestryEnergyResourcesAlliance(SAFER)UF/IFASpublication:

http://www.saferalliance.net.19http://tonto.eia.doe.gov/state/state_energy_profiles.cfm?sid=FL#overview

20PersonalCommunication.TedKury,PublicUtilityResearchCenter.August18,2009

21EIAAssumptionsReport:2009.http://www.eia.doe.gov/oiaf/aeo/assumption/index.html.

22http://www.flsenate.gov/data/session/2008/House/bills/billtext/pdf/h713503er.pdf,andtheExecutiveOrder07127:

http://www.dep.state.fl.us/ClimateChange/files/2007.07.13_eo_07127.pdf


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does not currently have programs for personal income tax, grants and bonds. The energy

efficiencyincentivesincludeLocalRebatePrograms,grants,andloans.

TheDistrictofColumbiaand24stateshaveanRPSpolicy inplace. Fiveotherstates,

NorthDakota,SouthDakota,Utah,Virginia,andVermont,havenonbindinggoalsforadoption

ofrenewableenergy insteadofanRPS.Mostofthestatessetthestandards inpercentageof

energy to be generated by renewable sources. These percentages ranged from 8% in

Pennsylvaniato40%inMaine,withthemajorityofthestatesinthe20%range.TexasandIowa

set their renewable energy production goals by Megawatts to be generated by renewable

resources.ThetargetyeartoattainthedesiredRPSdifferswidelybystate.VermontandNew

Yorkstargetyearis2013,whereasCaliforniatargeted2030toattainitsRPSgoals.SeeTable28

inAppendixA.


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CurrentIncentivesMixAuthors:

Dr.JulieHarrington,Director,FSUCEFAandFSUIESESmember

Dr.BassamAwad

ZafarSiddiqui

DavidGlassner

TedKury,UFPURC

This section outlines the current incentives available in Florida and at the Federal

Government level, for the promotion of renewable energy and energy efficiency. In

consultation with the Florida Energy and Climate Commission and Enterprise Florida, we

summarize Floridas current clean energy incentives in this section and list all economic

incentivesthataffectthecleanenergysector inFlorida. Inaddition,we includedetailsabout

thetotalamountofStatefundsallocatedtoeachincentive,andtheincentivesannualuse.

ThissectionhighlightsthestateincentivesinteractionwithsimilarFederalincentives.In

addition,thissectionalsoincludesanevaluationofthestateincentivestargetingthecleantech

sectorandananalysisoftheintendedeconomicimpactofeachincentiveprogram.Weaimto

benchmark the performance or impact against similar types of programs or programs with

similarobjectivesinotherjurisdictionsoranalogousindustries/sectors.

InFlorida,therearebroadbasedeconomicdevelopmentprogramsthatprequalifythe

cleanenergysector.Inordertogiveacomprehensiveandamoreholisticperspective,wecover

FloridaEnergyEfficiencyandConservationAct(FEECA),theprogramsofferedbylocalutilities,

cities, and counties, and federal incentives for the deployment of energy efficiency and

renewableenergyproducts.

InventoryofEconomicIncentivesThatImpacttheCleanEnergySectorinFlorida

Government incentives (both State and Federal) can be categorized into two basic

categories; up front incentives and performance based incentives. This section will look at

currentFloridarenewableenergyincentives.Thetypesofincentivesthatwillhaveanimpacton

theCleanEnergySector inFloridaareshown inTable4.Therearevarioustypesof incentives

that are directed at different technologies and sectors of the economy. The Corporate Tax


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Creditfrom theRenewable Energy Production Program andRenewable Energy Technologies

InvestmentprogramaredirectedattheCommercialsectors.

The Renewable Energy Production Tax Credit applies to solar thermal electric,

photovoltaics,wind,biomass,hydroelectric,geothermalelectric,CHP/Cogeneration,hydrogen,

tidalenergy,waveenergyandoceanthermaltechnologies.Theincentiveamountis$0.01/kWh

ofelectricityproducedfrom1/1/2007to6/30/2010.Whilethereisnoindividualmaximum,no

entitywill receivemore than$5millionper fiscal year.TheRenewableEnergyTechnologies

Investment Tax Credit is aimed at renewable fuel vehicles, fuel cells, hydrogen, refueling

stations,ethanolandbiodieseltechnologies.Thecreditcovers75%ofallcapitalcostsincluding

Operations and Maintenance (O&M) and Research and Development (R&D). The maximum

incentiveamountvariesbyprojectandtheexpirationdateis6/30/2010.

The Renewable Energy Property Tax Exemption focuses on incentives for the

Commercial, Industrial,andResidentialsectors.Theprogramoffers incentivesforsolarwater

heaters,photovoltaics,wind,geothermalheatpumps,anddirectusegeothermaltechnologies.

Itoffersa100%exemptionfrompropertytaxonunitsinstalledafter1/1/2009.

TheSolarEnergySystemsEquipmentSalesTaxExemptionofferscompleteexemption

onsalestaxforsolarwaterheaters,solarspaceheaters,photovoltaics,andsolarpoolheating

within the sectorsofCommercial,Residential,andGeneralPublic/Consumer.TheRenewable

Energy Equipment Sales Tax Exemption applies to the same sectors, but only to the

technologies of renewable fuel vehicles, fuel cells, other alternative fuel vehicles, refueling

stations,ethanol,andbiodiesel.Theexpirationdateforthisprogramis7/1/2010.

Florida alsooffers a state grantprogram, theRenewableEnergyTechnologiesGrants

Program,directedatcommercial,nonprofit,school, localgovernmentandutilitysectorswith

varied incentive amounts. The grants are available for the technology development in heat

recovery,solarwaterheating,solarspaceheating,solarthermalelectric,solarthermalprocess

heat,photovoltaics,wind,biomass,hydroelectric,geothermalheatpumps,CHP/Cogeneration,

hydrogen, directuse geothermal, solar pool heating, tidal energy, wave energy and ocean

thermal.

TheSolarEnergySystem IncentivesProgram isastaterebateprogram forsolarwater

heaters,photovoltaicsandsolarpoolheating.Therearemanyrestrictionsonsizerequirements


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fortherebateandvaryingmaximumawardlevelsasshowninTable4.Commercial,Residential,

Nonprofit, Schools, Local Government, Federal Government, MultiFamily Residential and

Institutional sectorsare coveredunder thisprogram.Theexpirationdate for thisprogram is

6/20/2010.

Table4.InventoryofIncentivesThatImpacttheCleanEnergySectorinFloridaIncentiveName Incentive

Type

Eligible

Technologies

Applicable

Sectors

Amount Maximum

Incentive

Eligible

SystemSize

Expiration

Date

Capital investmenttax credit (FloridaStatutes220.191)

CapitalInvestmentTaxCredit

Solar panelmanufacturingfacility

Industrial,Commercial

100%, 75%and 50% fora qualifyingproject whichresults in acumulativecapitalinvestmentofat least$100,between$50$100 million,and between

$2550$respectively.

100% ofthequalifyingproject

Renewable EnergyProduction TaxCredit(Florida Statutes220.193)

CorporateTaxCredit

Solar ThermalElectric,Photovoltaics,Wind, Biomass,Hydroelectric,GeothermalElectric,CHP/Cogeneration,Hydrogen, TidalEnergy, WaveEnergy, OceanThermal

Commercial $0.01/kWhfor electricityproducedfrom1/1/2007through6/30/2010

Noindividualmaximum;State maxof $5million perfiscal yearfor allcredits

6/30/2010

Renewable EnergyTechnologiesInvestment TaxCredit (FloridaStatutes220.192)

CorporateTaxCredit

Renewable FuelVehicles, Fuel Cells,Hydrogen,RefuelingStations, Ethanol,Biodiesel

Commercial 75% of allcapital costs,operationandmaintenancecosts, andresearch anddevelopmentcosts

Varies 6/30/2010

Renewable EnergyProperty TaxExemption (FloridaStatutes196.175)

PropertyTaxExemption

Solar Water Heat,Photovoltaics,Wind, GeothermalHeatPumps,DirectUseGeothermal

Commercial,Industrial,Residential

100%exemption(for unitsinstalledafter1/1/2009

Solar EnergySystemsEquipment SalesTaxExemption(Florida

Statutes212.08(7)(hh))

Sales TaxExemption

Solar Water Heat,Solar Space Heat,Photovoltaics, SolarPoolHeating

Commercial,Residential,GeneralPublic/Consumer

Allsalestax

Renewable EnergyEquipment SalesTaxExemption(FloridaStatutes212.08(7)(ccc))

Sales TaxRefund

Renewable FuelVehicles, Fuel Cells,Other AlternativeFuel Vehicles,Refueling Stations,Ethanol,Biodiesel

Commercial,Residential,GeneralPublic/Consumer

Allsalestax 7/1/2010

Renewable EnergyTechnologiesGrants Program(Florida Statutes

StateGrantProgram

Heatrecovery,SolarWater Heat, SolarSpace Heat, SolarThermal Electric,

Commercial,Nonprofit,Schools, LocalGovernment,

Varies 6/30/2010


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IncentiveName Incentive

Type

Eligible

Technologies

Applicable

Sectors

Amount Maximum

Incentive

Eligible

SystemSize

Expiration

Date

377.804) Solar ThermalProcess Heat,Photovoltaics,Wind, Biomass,Hydroelectric,GeothermalElectric,Geothermal Heat

Pumps,CHP/Cogeneration,Hydrogen, DirectUse Geothermal,Solar Pool Heating,Tidal Energy, WaveEnergy, OceanThermal

Utility

Solar EnergySystem IncentivesProgram (FloridaStatutes377.806)

StateRebateProgram

Solar Water Heat,Photovoltaics, SolarPoolHeating

Commercial,Residential,Nonprofit,Schools, LocalGovernment,StateGovernment,Fed.Government,MultiFamilyResidential,Institutional

PV: $4/wattDC, SolarWaterHeaters:Residential $500; Nonresidential &Multifamily $15per1,000BTU/day,Solar PoolHeaters:$100

PV:Residential $20,000;Nonresidential $100,000,SolarWaterHeaters:Residential $500;Nonresidential& Multifamily $5,000,Solar PoolHeaters:$100

PV:2kWandlarger, Solarwaterheaters mustprovide atleast50%ofabuildingshotwaterconsumption

6/20/2010

http://www.dsireusa.org/incentives/index.cfm?State=FL

Insummary,oftheseeightprograms,thefollowingfiveprogramsarescheduledtosunsetJune

30,

2010:

RenewableEnergyProductionTaxCreditFloridaStatutes220.193

RenewableEnergyTechnologiesInvestmentTaxCreditFloridaStatutes220.192

RenewableEnergyEquipmentSalesTaxExemptionFloridaStatutes212.08(7)(ccc)

RenewableEnergyTechnologiesGrantsProgramFloridaStatutes377.804

SolarEnergySystemIncentivesProgram(SolarRebate)FloridaStatutes377.806

TotalStateFundsAllocatedtoEachIncentiveandtheIncentivesAnnualUse

As shown in the following table(s), for fiscal year 200910, a total of $20 million is

allocatedtotheincentivesforcleanenergysector.InFlorida,$11millionisearmarkedforthe

RenewableEnergyTechnologyInvestmentTaxCredit.Thiscanbeappliedto75%ofallcapital

costs,operationandmaintenancecostsandresearchanddevelopmentcosts.However,upper

caps are defined as $3 million in connection with hydrogenpowered vehicles and fueling


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stations;$1.5millioninconnectionwithaninvestmentincommercialstationaryhydrogenfuel

cellsinthestate;and$6.5millioninconnectionwithaninvestmentintheproduction,storage

anddistributionofbiodieselandethanol.

The Renewable Energy Production Tax Credits account for $5millionof thebudget

during 20092010. This credit is available to encourage the development and expansion of

facilitiesthatproducerenewableenergy inFlorida.Thiscreditwillbeequalto$0.01foreach

kilowatthourofelectricityproducedandsoldbythetaxpayertoanunrelatedpartyduringa

giventaxyear.Thereisanupperlimitof$5millionperstatefiscalyearperapplicant.

The third major category of incentives is the Renewable Energy Technologies,

Machinery,Equipment,andMaterialSalesandUseTaxRefund,whichaccountfor$4millionof

budgetary allocation. Businesses may apply for a refund of sales and use taxes paid on

equipment,machinery,andothermaterials forrenewableenergytechnologies.There isa$2

million annual statewide cap for hydrogenpowered vehicles, materials incorporated into

hydrogenpowered vehicles, and hydrogen fueling stations. For materials used in the

distribution of biodiesel and ethanol, including fuelling infrastructure, transportation and

storage,thereisanannualstatewidecapof$1million.23

As outlined in the following Table 5, a total of about $16.23 Million for (out of a

potential$20Million)isstillunusedinprogramfundingintherenewableenergytaxcreditand

salesandusetaxcategories.24

Sometax incentiveshavebeenusedmorethanothers. TheProductionTaxCredithas

beenconsistentlyusedandthebiofuelinfrastructurecreditisshowingincreasedconsumption,

butthehydrogenvehicle incentivehasbeenbarelyused. The legislatureshouldrevieweach

technology granted a tax incentive and determine whether the tax code is the proper

instrument to catalyze that market. If Florida elects to support precommercially deployed

technologies, then the state shoulddesign incentives targeted to those technologiesneeds.

The data suggests there are state dollars allocated to these incentives that might be more

productively used. In addition, it would be beneficial to examine the current method of

informationdissemination tothepublicregarding thestate incentiveprogram, toensure the

broadestcoverage,applicationrate,anduseofcurrentlyavailableincentives.

23http://www.bdb.org/clientuploads/PDFs/CleanEnergyIncentives.pdf

24PersonalCommunicationwithEOGstaffmemberAprilGroover,February22,2010


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Table5.RemainingBalancesasofJanuary29,2010ofRenewableTaxCredits/SalesTaxRefundsRenewableEnergyProductionTaxCredit

2008 2009 2010 2011

Appropriation $5,000,000.00 $5,000,000.00 $5,000,000.00 $5,000,000.00

FundsExpended $1,925,730.00 $1,676,830.00 $0.00 $0.00

Balance $3,074,270.00 $3,323,170.00 $5,000,000.00 $5,000,000.00

PercentofFundsExpended 38.51% 33.54% n/a n/a

RenewableEnergyTechnologiesInvestmentTaxCredit

Hydrogen(Vehicles) FY0607 FY0708 FY0809 FY0910

Appropriation $3,000,000.00 $3,000,000.00 $3,000,000.00 $3,000,000.00

FundsExpended $0.00 $0.00 $0.00 $1,547,586.75

Balance $3,000,000.00 $3,000,000.00 $3,000,000.00 $1,452,413.25

PercentofFundsExpended 0.00% 0.00% 0.00% 51.59%

Hydrogen(StationaryFuelCells) FY0607 FY0708 FY0809 FY0910

Appropriation $1,500,000.00 $1,500,000.00 $1,500,000.00 $1,500,000.00

FundsExpended $0.00 $0.00 $1,500,000.00 $1,500,000.00

Balance $1,500,000.00 $1,500,000.00 $0.00 $0.00


Biodiesel&EthanolInfrastructure FY0607 FY0708 FY0809 FY0910

Appropriation $6,500,000.00 $6,500,000.00 $6,500,000.00 $6,500,000.00

FundsExpended $3,347,482.62 $4,519,660.30 $2,473,456.24 $0.00

Balance $3,152,517.38 $1,980,339.70 $4,026,543.76 $6,500,000.00


RenewableEnergyEquipmentSalesTaxExemption

Hydrogen(Vehicles) FY0607 FY0708 FY0809 FY0910

Appropriation $2,000,000.00 $2,000,000.00 $2,000,000.00 $2,000,000.00

FundsExpended $0.00 $0.00 $0.00 $0.00

Balance $2,000,000.00 $2,000,000.00 $2,000,000.00 $2,000,000.00

Percent

of

Funds

Expended

0.00%

0.00%

0.00%

0.00%

Hydrogen(StationaryFuelCells) FY0607 FY0708 FY0809 FY0910

Appropriation $1,000,000.00 $1,000,000.00 $1,000,000.00 $1,000,000.00

FundsExpended $0.00 $0.00 $219,004.98 $235,176.90

Balance $1,000,000.00 $1,000,000.00 $658,944.91 $764,823.10


Biodiesel&EthanolInfrastructure FY0607 FY0708 FY0809 FY0910

Appropriation $1,000,000.00 $1,000,000.00 $1,000,000.00 $1,000,000.00

FundsExpended $0.00 $3,982.60 $41,349.06 $482,726.69

Balance $1,000,000.00 $996,017.40 $958,650.94 $517,273.31


Concerning the companies that have engaged in theSEP tax credit and sales tax

programfromFY0610,thefollowingobservationsweremade:

Biodiesel and Ethanol: Almost allof the tax credit funds areusedbyone company

Marathon Petroleum. It is unknown what innovations have been produced by this

company to date. The sales taxprogram has more widespread usage in small


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quantities.FirstCoastEnergyLLPusedaboutaquarterofthefundinginFY20092010.

Kinder Morgan Liquids Terminals LLC and Central Florida Pipeline each used abouta

tenthofthefundingduringthesametimeperiod.

Hydrogen(Cells):MetroPCSFloridaLLCistheonlycompanyusingboththecreditsand

the sales tax program. They perhaps were unaware of the tax credit and sales tax

offeringsfromearlier,inFY20062008,buthavesinceusedallthetaxcreditsavailable

andpartofthesalestaxexemption.Itappearsthatonecompanyisusingthemajority

ofthefundshence;itisassumeditisdirectedtowardsausabletechnology.Theresults

ofthetechnologygeneratedbytheseincentiveofferingsareunknownatthistime.

Hydrogen(Cars):UnitedNaturalFoodistheonlycompanyusingthetaxcredits.

Since 2006, The Renewable Energy Technology Grant Program has distributed $42.5

milliondollars. Grantsareattractive to industrybecausetheapplicationprocess isrelatively

straightforwardandtheawardsareflexible.Althoughpopular,thestatemaywanttoconsider

selfsustaining mechanisms such as: a loan program, performance based incentives, or an

investmentprogram rather thanappropriatinggeneral revenueeachyear for thegrant. The

statemaywant tousepublic/privatepartnerships to leverage fundingandengageabroader

stakeholdergrouptoselectawardwinners.

Table6.RenewableEnergyTechnologiesGrantsProgram

FY0607 FY0708 FY0809 FY0910Appropriation $15,000,000.00 $12,500,000.00 $15,000,000.00 $0.00FundsCommitted $15,000,000.00 $12,500,000.00 $15,000,000.00 $0.00FundsExpended $6,880,995.61 $1,458,730.21 $1,048,187.08 $0.00*AsofJan29,2010**$1.676outof$5millionappropriated,hasbeenappliedfor

Since2006,theSolarEnergySystem IncentivesProgram(SolarRebate)hasdistributed

$24.9milliondollars(Table7).Thelegislatureshouldaddresstheeffectivenessandrevisethe

SolarRebateProgram. The SolarRebates$4perwatt subsidyhasnot changed since2006

althoughboth thecostof the technologyandother incentiveshas reduced theneed for the

statesubsidy. Inadditiontothedecliningcostsofsolarhardware,boththe federaltaxcode

and Florida Energy Efficiency and Conservation Act (FEECA) have provided alternative

incentives.TheEnergyImprovementandExtensionActof2008(H.R.1424)includedaneight

yearextensionofthe30%personalincometaxcredittoDecember31,2016,theabilitytotake

thecreditagainstthealternativeminimumtax,andtheremovalofthe$2,000credit limitfor

solarelectricsystemsbeginningin2009.In2009,FEECAutilitieswereauthorizedtoprovideup


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to $24.5 million in total annual incentives for customerowned solar water heaters and

photovoltaic systems. The current rebate appears to be outdated and in light of other

incentives,maynotbeneeded to encourage thedeploymentof residential and commercial

solarsystems.

Table7.SolarEnergySystemIncentivesProgram(SolarRebate) FY0607 FY0708 FY0809 FY0910

Appropriation $2,500,000.00 $3,000,000.00 $5,000,000.00 $14,400,000.00

FundsExpended $0.00 $0.00 $0.00 $14,400,000.00

Balance $2,500,000.00 $3,000,000.00 $5,000,000.00 $0.00


TheARRA,orFederalStimulusPlan,allocates$40.5million toFloridaunder theState

Energy Program (SEP). An economic impact analysis was performed on the individual state

energyprogramsusingRegionalEconomicModels,Inc.,orREMI.REMI(v9.262007)isawidely

useddynamic(multipletimeperiod,uptoyear2050)integratedinputoutputandeconometric

model.REMIisusedextensivelytomeasureproposedlegislativeandotherprogramandpolicy

economic impacts across the private and public sectors of the state by the Florida Joint

LegislativeManagementCommittee,DivisionofEconomic&DemographicResearch,theFlorida

Departmentof Labor, andother state and local government agencies. In addition, it is the

chosentooltomeasuretheseimpactsbyanumberofuniversitiesandprivateresearchgroups

thatevaluateeconomic impactsacross thestateandnation.FSUCEFAuses theREMImodel

thathasbeendevelopedforthestateofFloridaandincludes169sectors(basedontheNorth

American IndustrialClassificationSystem,orNAICS).Aspresented inTable8, thenumberof

projected jobs associated with each SEP program totaled 494 jobs. The most successful

programunderSEPintermsofjobscreationistheSolarEnergyRebateProgram,whichresulted

in193jobs. Itwas followedby theSolarEnergy (WaterHeating)LoanProgramandSolar for

SchoolsandSheltersProgramwith119and103jobs,respectively.

Table8.EconomicImpactofStateIncentivesinTermsofJobsCreated

StateEnergyPrograms ActualallocationJobsCreatedasperActual

Allocation

SolarEnergy(WaterHeating)loan $10,000,000 103

SolarEnergyRebateProgram $14,408,000 193

SolarforSchools&StormShelters $10,000,000 119

E85Installation/ConversionRevolvingLoans $5,000,000 62

ProgramAdministration,Marketing&Analysis $1,074,300 17

SubtotalRenewableEnergy $40,482,300 494


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RegardingtheincentivesinteractionwithsimilarFederalincentives(i.e.Stateoffersa

solarrebate,Federalgovernmentoffersanincometaxcredit),thisreportfoundnolanguagein

anyincentiveprovisionsindicatingthatacceptinganincentivefromeitherStateorGovernment

wouldprohibitonefromacceptinganincentivefromtheother,grantedthetechnologyapplies

toboth incentives.There is indicationof a doubledippingprovision to reduce the federal

incentive inthePrivateTrustCompanies(PTC)statute.Forwindbasedpowergeneration,the

FederalProductionTaxCredit(PTC)isasignificantincentive.Itprovidesfederaltaxcredittothe

ownersofutilityscalewindprojects.Whilethe federalPTChasbeenamajorstimulustothe

growthofthedomesticwindpowermarket, itssocalleddoubledippingprovisionmayalso

diminishthevalueofcertaintypesofstatewindpowerincentives.Theprovisionrequiresthat

the federal PTC be reduced if a wind project receives certain other kinds of support. To

eliminatedoubledipping, the federalPTC is reduced forany local,state,or federalgrants,

subsidizedenergyfinancing,andanyothercredits.Thepurposeofthisruleisstatedtoprevent

excessiverelianceongovernmentassistance.25

FederalIncentivesforFlorida

Table 29 (in Appendix A) outlines the full slate of incentive offerings by the federal

government.

The specific language in the PTC is as follows: Credit Reduced for Grants, Taxexempt

Bonds,SubsidizedEnergyFinancing,andOtherCredits:Theamountofthecredit...withrespect

toanyprojectforanytaxableyear...shallbereducedbytheamountwhichistheproductofthe

amountsodeterminedforsuchyearandafraction:

(A)Thenumeratorofwhichisthesum,forthetaxableyearandallpriortaxableyears,of

grantsprovidedbytheUnitedStates,aState,orapoliticalsubdivisionofthe

Stateforuseinconnectionwiththeproject,

proceedsofanissueofStateorlocalgovernmentobligationsusedtoprovidefinancing

fortheprojecttheinterestonwhichisexemptfromtaxundersection103,

the aggregate amountof subsidized energy financing provided (directly or indirectly)

25 Ing, E.2002. The EffectofNYSERDAsWindProjectAssistanceon theFederalProductionTaxCredit.Prepared for theNew YorkState

EnergyResearchandDevelopmentAuthority.Rader,N.andR.Wiser.1999.StrategiesforSupportingWindEnergy:AReviewandAnalysisofState Policy Options.Washington,D.C.:NationalWindCoordinatingCommittee.RyanWiser,MarkBolinger and TroyGagliano. Sep2002.Analyzing the InteractionBetweenStateTax Incentivesand theFederalProductionTaxCredit forWindPower.ErnestOrlando LawrenceBerkeleyNationalLaboratory.http://eetd.lbl.gov/EA/EMS/reports/51465.pdf


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underaFederal,State,orlocalprogramprovidedinconnectionwiththeproject,and

theamountofanyothercreditallowablewithrespecttoanypropertywhich ispartof

theproject,and

(B) The denominator of which is the aggregate amount of additions to the capital

accountfortheprojectforthetaxableyearandallpriortaxableyears.

Thestatutorylanguageleavesambiguityastowhichspecifictypeofstateincentivesmay

triggerthedoubledippingprovision.Albeit, itisclearthatanumberofformsofstateaidwill

offsetat leastpartially thebenefitassociatedwith the federalPTC.Nonetheless,despite

legislativehistoryandanumberofprivateletterrulings,thereremainsalackofclarityonthe

kindsofstateincentivesthatwouldtriggertheoffset.Somestudiesprovidetangibleexamples

ofincentivetypesthatareorarenotlikelytooffsetthevalueofthePTC.26

GovernmentincentivesthatarelikelytotriggeraPTCoffsetincludeupfrontgrantsthat

buy down the projects capital costs, and belowmarket interest loans and other forms of

subsidizedfinancing. IncentivesthatarenotlikelytotriggerPTCoffsets includepricesupport

payments,production incentivepayments,grantstomeetoperationalcosts, loanguarantees,

andimplicitsubsidiesprovidedthroughrenewablepurchasemandates.27

Therefore, it is clear that state tax incentives are at risk of reducing the value of the

federalPTC,viathesocalleddoubledippingprovision.ButfederaltaxlawandIRSrulingsare

notclearenoughtospecifywhattypesof incentivestriggerthisoffset.Giventhisprovisionof

federalPTCsandtheiruncertainapplicationtostatetax incentives,nontaxbasedstatewind

power policies (cashbased production incentives, renewable purchase mandates, etc.) that

clearlydonotoffsetthefederalPTCmaybepreferable.

TheNewJerseyexperience isanexampleofthesuccessof incentivescontingentonthe

amountofjobscreated. Inparticular,there isadefiniteneedtocreateamarketbypolicyto

incentivizethemarket.ThekeyistocreatethemarketnotfortheendpurposeofinstallingPV

in the state (an added benefit) but the goal should be to attract the high leveljobs (e.g.

cell/panelmanufacturing,supplychainmanufacturing(e.g.balanceofsystems),systemsdesign

andR&D).

26RyanWiser,MarkBolingerandTroyGagliano2002

27Ing,E.2002


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The Federal government has several existing programs to promote home energy

efficiency.SomeoftheseprogramswereinitiatedundertheEmergencyEconomicStabilization

Actof2008(EESA)andcontinuedundertheAmericanRecoveryandReinvestmentActof2009

(ARRAorStimulusPackage).Otherswere initiatedundertheARRA.Thisgroupofprograms is

implementedintheformofadirecttaxcredittothetaxpayer,orapplicant.Becauseitisatax

credit, the taxpayer will see a dollar for dollar return on the investment, regardless of the

taxpayersincometaxbracket.28

It is critical to understand that not all Energy Star appliances qualify under these

programs,butonly appliances from selected categories. The first groupofprogramsapplies

only to appliances and improvements installed in the applicantsprimary residence andwill

continuethroughDecember31,2010.Theydonotapplytonewconstruction.Someofthese

creditsincludeinstallationcosts,whileothersdonot.Thesecreditsare30%oftheactualcost

of the appliance or improvement,up to $1,500.The typesof appliances and improvements

coveredunderthisprogramarebiomassstoves,highSEERHVACunitsofvarioustechnologies,

insulation, metal and asphalt roofs, high energyfactor water heaters (excluding solar), and

energyefficientdoors,windows,andskylights.Thecreditsforbiomassstoves,HVACunits,and

water heaters include the costs of installation, while the credits for insulation, metal and

asphaltroofs,andenergyefficientdoors,windows,andskylights,donot.

Thesecondandthirdgroupsofprogramsrelatetothehome installationofrenewable

electricgenerationsystems,andwillcontinuethroughDecember31,2016.Thesecondgroup

applies to the applicants primary or secondary residence, but not to rental homes. These

credits canbeapplied tobothnewandexistinghomes. Installationcostsarecoveredunder

theseprograms.Thecredit isfor30%ofthe installedcostofthesystemwithnoupper limit.

The systems covered include geothermalheat pumps, residentialwind turbinesofno more

than100kW,solarwaterheaters(excludingpoolheaters),andsolarphotovoltaicsystems.The

thirdprogramappliesonlytotheapplicantsprimaryresidence,whichcanbeanexistinghome

ornewconstruction.Residentialfuelcellandmicroturbinesystemsofatleast0.5kWapplyto

28TheARRAextendsuntil2014 taxcredits for renewableenergy thathadpreviouslybeen scheduled toexpireandbyproviding$6billionworth of loan guarantees authorized by the Energy Policy Act of 2005 for renewableelectricitydevelopment. These loan guarantees areexpected to stimulate the deployment of conventional renewable and transmission technologies and innovative biofuels technologies. ForrenewableprojectstoqualifytheymustbeunderconstructionbySeptember30,2011.SeeAppendixGfordetailsonFederalLoanGuarantee


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thisprogram.Thecreditcovers30%ofthe installedcostofthesystem,up toamaximumof

$500per0.5kW.

FloridaEnergyEfficiencyandConservationAct(Section366.82)

Florida

utilities

with

sales

of

2,000

GWh

or

more

are

subject

to

the

Florida

Energy

Efficiency and Conservation Act (FEECA). This act requires each utility to implement cost

effectiveenergyefficiencyprogramsandtoconductenergyaudits.TheLegislaturedirectsthe

FloridaPublicCommissiontodevelopandadoptoverallgoalsandauthorizesthecommissionto

requireeachutilitytodevelopplansand implementprogramsfor increasingenergyefficiency

and conservation and demandside renewable energy systems within its service area. The

majorobjectivesoftheFEECAareto:

Reduceandcontrolthegrowthratesofelectricconsumption;

Reducethegrowthratesofweathersensitivepeakdemand;

Increase the overall efficiency and costeffectiveness of electricity and natural gas

productionanduse;

Encourage further development of demandside renewable energy systems; and

conserveexpensiveresources,particularlypetroleumfuels.

TheCommissionisauthorizedtofinanciallyrewardthoseutilitiesthatexceedtheirgoals

andmay imposepenalties for thoseutilities that fail tomeet theirgoals.TheCommission is

authorized toallowan investorownedelectricutilityanadditional returnonequityofup to

0.5% for exceeding 20 percent of their annual load growth through energy efficiency and

conservationmeasures.

EnergyEfficiencyandRenewableEnergyIncentivesinCleanEnergyJobsandAmericanPower

Act2009

Table

29

(in

Appendix

A)

consists

of

federal

programs

available

through

the

Department

of the Treasury, Department of Energy, and Department of Agriculture. Some of these

programsareenabledthroughtheAmericanRecoveryandReinvestmentActof2009.Thislistis

thoughttobecomplete,butmaynotbeexhaustive.


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Section161:RenewableEnergy

Under this section, theAdministrator, in consultationwith the SecretariesofEnergy,

Interior,andAgriculture, isauthorized toestablishaprogram toprovidegrants to states for

renewableenergyprojectsthatfacilitatecompliancewithastateRenewablePortfolioStandard

(RPS). Qualifyingsourcesofenergy includesolar,wind,biomass, landfillgas,ocean(including

tidal, wave, current, and thermal), geothermal, municipal solid waste, or new hydroelectric

generation capacity achieved from increased efficiency or additions of new capacity at an

existinghydroelectricproject.Theamountofthegrantmaynotexceed50percentofthetotal

costoftherenewableenergyprojectthatistobefundedbythegrant.Applicationsthatcome

from a state thathave abinding renewableenergyportfolio standard andprojects that are

costeffectivearetobegivenprioritywhenawardingthegrant.Tomonitorthegrantprogram,

theAdministratorisrequiredtosubmitareporttotheCommitteesonEnergyandCommerce

oftheHouseofRepresentativesandtheSenate.Thereportmustincludeinformationaboutthe

projectapplicationsreceived,projectapplicationsapproved,amountallocatedtoeachproject

andthecumulativebenefitsofthegrantprogram.

Section162:AdvancedBiofuels

AccordingtoSection162oftheBill,anindividual,corporateentity,unitofStateorlocal

government, Indian tribe, farm cooperative, institution of higher learning, rural electric

cooperative,orpublicutilitywillbeentitledtoagranttosupport;

researchregardingtheproductionofadvancedfuels

the development of new advanced biofuel production and capacitybuilding

technologies

the development and construction commercialscale advanced biofuel production

facilities

theexpandedproductionofadvancedbiofuels

The grants will be awarded based on costeffectiveness, technical and economic

feasibility and innovation. Furthermore, priority will be given to programs that can be

replicatedandthatarebeingfinancedbyprivateresources.


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Section163EnergyEfficiencyinBuildingCodes

EnergyEfficiencyTargets

Thissection requires theAdministrator (oranotheragencyheadasdesignatedby the

President)tosetnationaltargetsforimprovingenergyefficiencyinresidentialandcommercial

buildings, and write regulations establishing building codes to meet those targets. Buildingswould have to meet the energy efficiency targets beginning Jan. 1, 2014 and every year

thereafterthroughDec.31,2030.TheAdministratororotheragencyheadisrequiredtoreport

toCongressannuallyonthestatusandimplementationofthecodesandregulations.

Section164:RetrofitforEnergyandEnvironmentalPerformance

This section of the bill establishes the Retrofit for Energy and Environmental

Performance(REEP)program.Thepurposeoftheprogramistoretrofitexistingbuildingsacross

the United States to achieve maximum costeffective energy efficiency improvements and

significantimprovementinwateruse.

FinancialIncentivesforResidentialandNonResidentialBuildingsareasfollows:

ForResidentialBuildings:

$1,000 for a combination of prescriptive measures designed to reduce energy

consumption by more than 10% (but not less than 10%), and $2000 for prescriptive

measuresdesignedtoreduceenergyconsumptionby20%;

$3,000 for actual demonstrated savings of 20% utilizing the performance based

structure,and$150peradditionalpercentagepointofenergysavingsachieved;

Incentivesmayaccumulatetoamaximumincentivenottoexceed50%ofretrofitcosts.

ForNonResidentialBuildings:

Amaximumof$0.15persquarefootofretrofitareaforenergyusereductionsfrom20%

to30%;

$0.75persquarefootforenergyusereductionsfrom30%to40%;

$1.60persquarefootforenergyusereductionsfrom40%to50%;and

$2.50persquarefootforenergyusereductionsexceeding50%.

Incentivesmayaccumulatetoamaximumincentivenottoexceed50%ofretrofitcosts.


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ProgramsOfferedbyLocalUtilities,Cities,andCounties

In Florida, some counties and municipal governments, and utilities offer inhouse

programs.Table30 inAppendixAprovidesa listingofthoseprograms.Someprogramshave

proven more successful than others. Among counties, MiamiDade, and Orange counties

offered programs ranging from green building to solar/thermal installers. Among citybased

utilities,theCityofTallahasseeoffersprograms likesolarefficiency loans,pool/waterheating

programs, residential energy efficiency rebate programs, energy star new homes rebate

program,solar loanprogram,utility rebateprogramandvariousothers.Programs likeonbill

financing were successful whereas the solar loan program has proven to not be successful.

Prominentamong theprogramsofferedbyOrlandoUtilityCommissionare thehomeenergy

efficiencyfixupprogram,utilitygrantprogram,residentialinsulationloanprogram,residential

solar loan program and the residential energy efficiency rebate program. The Gainesville

RegionalUtilitieshas itsown solar feedintariff andenergyefficiency rebateprograms.The

FortPierceUtilityAuthoritysprominentprogramsaretheresidentialenergyefficiencyrebate

program, utility rebate program and building insulation program. The Kissimmee Utility

Authorityoffers the residentialenergyefficiency rebateprogram,utility rebateprogramand

various building insulation improvement plans. Various private power companies also offer

different energy efficiency programs. Gulf Power offers the geothermal installation rebate

program,utilityrebateprogram,solarwaterheaterprogramandsolarthermalwaterheating

pilotprogramsamongothers.Ahomeenergycheckauditandrebateprogramisofferedbythe

ProgressEnergyFlorida.Itsotherprogramsareutilityrebateprogramsandsolarwaterheating

with EnergyWise program. Florida Power and Lights prominent programs include the

residential energy efficiency program, utility rebate program, building insulation program.

Generally speaking, utility rebate programs are mostly successful in county and citybased

utilities,inadditiontotheprivatepowercompanies.

CommercialIncentives

There are several federal incentives available to manufacturers of certain appliances

thatuseenergyorwatermoreefficiently.Thetaxcreditsassociatedwiththeseappliancesgo

directlytothemanufacturer,andnotto theconsumer,butthegovernmentexpectsthatthe

creditwillbereflectedinthepriceoftheappliance.Through2010,themanufacturersofhigh

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