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May 15, 2009

Synergy

Yesterday Governor Jim Douglas announced that Vermont has submitted its claim for $21,999,000.00 in stimulus money for renewable energy projects. You can read that announcement at http://recovery.vermont.gov/news/22mRenewable. This is formula money – money that Vermont is entitled to under the American Recovery and Reinvestment Act (ARRA) so long as we can spend it quickly enough and follow all the rules. But this money is also part of our coordinated plan – SmartVermont – which aims to use stimulus money to transform the Vermont economy and assure that we are in a good competitive position for the very competitive 21st century.

Nothing subtle about this. We intend that our use of this $22 million plus another $7 million of state funds to develop small and medium scale renewable energy projects will help convince the federal Department of Energy that we ought to receive a healthy allocation of the $4.5 BILLION which is available nationwide for smart electrical grid projects. It takes a smart grid to make full use of electricity generated from sun and wind; the smart grid is more valuable if there are a variety of energy sources for it to coordinate. Vermont already has a number of renewable energy projects up and running and in process. We estimate that we can use $29 million of ARRA and state money to bring another $150 million worth of projects online which will generate more than 3 million megawatt hours of electricity over the next twenty years ; generating this electricity from natural gas would release 860 million pounds of CO2 .

On most nights Vermont has no carbon footprint for electrical generation; our power comes from HydroQuebec and Vermont Yankee. Moreover this offpeak power is cheap at wholesale, in comes cases – believe it or not - almost free because there's no easy way to shut down its production temporarily and it has to go somewhere. On the other hand the power for peak times is generated by burning natural gas in plants that are only used for hours a day if even that. This peak power is very expensive.

In an ideal world the sun would shine on our solar collectors and the wind would turn our turbines during times of high demand and save us from buying peak power and burning hydrocarbons to produce it. Unfortunately we don't live in that ideal world; the sun shines at random and the wind blows willfully. We need a smart electrical grid to help match supply and demand.

Among the projects that Vermont utilities will almost certainly seek ARRA smart grid funding for is electricity storage – essentially big high tech batteries. These are particularly effective when used with wind power. The wind blows when it will and charges the batteries ; the grid draws from the batteries before importing fossil-fueled power.

A smart grid is good at dispatching electricity to areas of demand from areas of surplus. Even a small state like Vermont can be half cloudy and half sunny on any given day. Methane in cow power digesters can be hoarded until extra electricity is needed. Water can accumulate behind dams while the wind blows and be released on still days.

A smart grid is used to manage demand as well as supply. When there's a surplus of power, low prices encourage consumers to dry their clothes, charge up their electric vehicles and appliances, and store up heat. When power is in short supply, higher prices and information about those higher prices encourage consumers to avoid electrical consumption.

In context yesterday's announcement of incentives for distributed generation of electricity from renewable sources means that Vermont will be ready to demonstrate all of the benefits of a smart grid for energy independence and reduction of CO2. We hope the Department of Energy will see it that way when they consider our applications for smart grid projects. If they do, we'll have a smart grid sooner than otherwise and get even more value from all of our generation and transmission capacity.

That's called synergy. We should know much more about how close we come to accomplishing this plan in the next few months.

 

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