Download - Presentation on Global REC Market by Shri Stephen R. Fernands, President, Customized Energy Solutions

7/31/2019 Presentation on Global REC Market by Shri Stephen R. Fernands, President, Customized Energy Solutions

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Customized Energy Solutions Ltd.Customized Energy Solutions Ltd.

1528 Walnut Street, 221528 Walnut Street, 22ndnd FloorFloor

Philadelphia, PA 19102 USAPhiladelphia, PA 19102 USA

Phone: +1Phone: +1--215215--875875--94409440

Fax: +1Fax: +1--215215--875875--94909490

info@[email protected]

Customized Energy Solutions India Pvt. Ltd.

A-501 G-O Square Aundh-Hinjewadi Link Road

Wakad, Pune 411057

Phone +91-20-30226106

Fax: +91-20-30201408

[email protected]

GlobalGlobal Renewable Energy CreditRenewable Energy Credit

Markets:Markets:

AA SnapshotSnapshotRenewable Energy CertificatesRenewable Energy Certificates WorkshopWorkshop

2424thth June 2011June 2011


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Customized Energy Solutions: ExperienceCustomized Energy Solutions: Experience

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20Projects

New Renewable

Projects

Analyzed in 2010

21,000MWh

Daily Scheduled

over 1500 MW of

Generation

Capacity and

Load Purchases

1500MW

Generation and

load curtailment

dynamicallyscheduled into

SCADA system

from 2MW to

150MW

600,000MWh

RECs sold in2010

Including

10,000MWh

of Solar RECs

230

ClientsServed in 2010

Clients include Mittal

Steel, GE, AES,

Iberdrola, Gamesa,

Pepsico, BP and

others.

Consulting: Maximizing generation revenues andminimizing costs of procurement

Trading: India Licensed Power Marketer

Operations: Smart Grid Communication

Technology and 24x7 Operations Center


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Global Picture of Renewable PowerGlobal Picture of Renewable Power

4Renewables 2010 status report


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Where does India Fit Into Global Renewable MakeupWhere does India Fit Into Global Renewable Makeup

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India is one of the leaders in renewable technology already and is poised to

be one of the most significant participants in the rapidly growing global

renewable market.


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4 Dominant Mechanisms for Renewable Development4 Dominant Mechanisms for Renewable Development

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Strength: LargeMarkets

Weakness: Oftenviewed as extra

Strength: Allows marketsto drive prices

Weakness: Rules can beeasily changed

Strength: Easy toImplement

Weakness:Transaction Costs

Strength: RevenueCertainty

Weakness: Doesnt

adjust to Market

Feed In

Tariff

FavorableTaxation

CarbonFinancing

RenewableEnergy

Credits


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Renewable Energy CertificatesRenewable Energy Certificates

Tradable (typically) financial instrumentRepresents the green of one MWh of energy

produced from a renewable resource

Can be traded as a commodity bundled or unbundledfrom underlying energy localized spot markets, multi-

year strips, long-term PPAs

Satisfy individual state RPS compliance

Meet voluntary or internal mandates

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Essential Elements of a REC ProgramEssential Elements of a REC Program

All Global REC markets have some similarities theseinclude;

Defining Attributes that Qualify as Renewable

Technology Carve Outs, tiers of different renewable sources

Vintages- Length of time from energy being generated to expiry of REC Locational/Deliverability requirements

Mandatory or goal compliance levels

Alternative Compliance Payment/Penalty levels (essentially

act as price cap on markets if supply shortage or can providefloor on market if there is an oversupply)

Establishing tracking system for credits (integrity of system is

essential)

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Countries and States Implementing REC ProgramsCountries and States Implementing REC Programs

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More than 56 States and

Countries have instituted RPS

Standards over past 26 years. REC

programs one of ways to

implement RPS system.


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US Compliance REC MarketsUS Compliance REC Markets OverviewOverview

State Specific, no national REC marketFederal policy, markets unlikely until at least 2012

Compliance markets exist in States with Renewable

Portfolio Standards (RPS)

RPSs are similar in construct and makeup but each State

has unique requirements and goals

REC trading between states is typically allowed within

an RTO, although exceptions are common

Compliance REC markets are highly illiquid

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US REC MarketsUS REC Markets RPS PoliciesRPS Policies

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Renewable portfolio standard

Renewable portfolio goal

Solar water heating eligible

*Extra credit for solar or customer-sited renewables

Includes non-renewable alternative resources

WA: 15% x 2020*

CA: 33% x 2020

NV: 25% x 2025*

AZ: 15% x 2025

NM: 20% x 2020 (IOUs)10% x 2020 (co-ops)

HI: 40% x 2030

Minimum solar or customer-sited requirement

TX: 5,880 MW x 2015

UT: 20% by 2025*

CO: 30% by 2020 (IOUs)10% by 2020 (co-ops & large munis)*

MT: 15% x 2015

ND: 10% x 2015

SD: 10% x 2015

IA: 105 MW

MN: 25% x 2025(Xcel: 30% x 2020)

MO: 15% x 2021

WI: Varies by utility;10% x 2015 statewide

MI: 10% + 1,100 MWx 2015*

OH: 25% x 2025

ME: 30% x 2000New RE: 10% x 2017

NH: 23.8% x 2025

MA: 22.1% x 2020New RE: 15% x 2020

(+1% annually thereafter)

RI: 16% x 2020

CT: 23% x 2020

NY: 29% x 2015

NJ: 22.5% x 2021PA: ~18% x 2021

MD: 20% x 2022

DE: 25% x 2026*

DC: 20% x 2020

VA: 15% x 2025*

NC: 12.5% x 2021 (IOUs)10% x 2018 (co-ops & munis)

VT: (1) RE meets any increasein retail sales x 2012;

(2) 20% RE & CHP x 2017

KS: 20% x 2020

OR: 25% x 2025 (large utilities)*5% - 10% x 2025 (smaller utilities)

IL: 25% x 2025 WV: 25% x 2025*

29 states +DC and PR have

an RPS(7 states have goals)

DCOK: 15% x 2015

PR: 20% x 2035

l


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Renewable Energy Credit TrackingRenewable Energy Credit Tracking

12

A l


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REC Projected Demand by RegionREC Projected Demand by Region

Projected gross demand by REC region (TWh)

Source: Bloomberg New Energy Finance

Note: Gross demand excludes voluntary RPS. NY demand is given explicitly by NYSERDA; values shown here are

for Main Tier only. SREC demand includes distributed generation carve-outs, most of which are expected to be

satisfied primarily through solar PV.

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2010 2011 2012

M-RETS 9.6 11 16.7

NEPOOL 14.5 16.7 18.6

PJM 27 35.8 44.8

WREGIS 8.6 14.1 17.3

CAISO 48.8 50.4 51.3

NYISO 2.9 4.3 5.6

SRECs 0.7 2.0 2.5

A l


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REC Projected Supply by RegionREC Projected Supply by Region

Installed capacity by REC region Existing and projected capacity1 (GW)


Projected capacity consists of both identified and unidentified projected capacity. Identified projected capacity

consists of bottom-up, project-specific capacity expected to come online; the further out the projections, the

higher the percentage of projected capacity that comes from unidentified portion.

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2010 2011 2012

M-RETS 9.1 9.3 11

NEPOOL 3 3.1 3.3PJM 6.2 7.4 8.2

WREGIS 9.8 11.8 12.5

CAISO 7.7 8.5 9.6

NYISO 1.9 2.6 3.1

Analy e


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Progress Toward REC Goals by RegionProgress Toward REC Goals by Region

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Customized Energy Solutions Ltd.Customized Energy Solutions Ltd.

1528 Walnut Street, 221528 Walnut Street, 22ndnd FloorFloor

Philadelphia, PA 19102 USAPhiladelphia, PA 19102 USA

Phone: +1Phone: +1--215215--875875--94409440

Fax: +1Fax: +1--215215--875875--94909490

info@[email protected]

Customized Energy Solutions India Pvt. Ltd.

A-501 G-O Square Aundh-Hinjewadi Link Road

Wakad, Pune 411057

Phone +91-20-30226106

Fax: +91-20-30201408

[email protected]

Stephen FernandsStephen FernandsPresidentPresident

+91(800)746+91(800)746--18701870sfernands@[email protected]

www.ceswww.ces--ltd.comltd.com

Download - Presentation on Global REC Market by Shri Stephen R. Fernands, President, Customized Energy Solutions

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