Tuesday, November 17, 2009

Shorted: Paying for Green Power, and Getting Ads Instead. (November 17, 2009). New York Times, p. B1.

Kate Galbraith, the author of the article, questioned the means by which utilities fund green projects. Questioning the methods of financing the green movement, this article discussed consumer costs and utility expenses of renewable energy. First, the article disclosed that only 2 percent of all utility customers chose the green alternative over conventional energy sources. One possible reason for the reluctance, the author explained, might stem from the consumers' belief that purchasing green energy does not promote building renewable energy projects. The US government, in studying the issue, agreed in the difficulty of assigning a cause and effect relationship. A problem arose with the completion of green projects. Some have lagged behind their published schedules. In the case of Florida Power and Light, delays in building solar power facilities caused the PUC to terminate the company's green funding initiative, Sunshine Energy.

Additionally, the Sunshine Energy project spent over 75 % of consumer contributions to marketing and administrative costs, the author claimed. Utility executives considered the spending consumer education. The National Renewable Energy Laboratory in Colorado found that nationally marketing and administrative costs average 19 %.

Some utilities distribute renewable energy certificates, the value of which dictate the amount renewable energy they purchase in the open market. Renewable energy developers argue that the system "provides flexibility and helps improve project economics" (p. B8). The cost of renewable energy might deter most people from signing up for renewable energy, in some cases a 40 % premium.

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