Navigant Research Blog

March Madness—For Clean Energy

— April 7, 2015

This year’s NCAA basketball tournament was more surprising than most, with an estimated 70 million brackets filled out, the series of Big 12 upsets in the first round now referred to as Black Thursday, and our very own James McCray accurately predicting a Badgers/Duke Championship in the Navigant Research pool. What is more surprising than any of this, however, is the Rocky Mountain Institute’s (RMI’s) renewable energy bracket. RMI filled out a bracket based on the renewable energy portfolio of the utility serving the main campus of each school participating in the tournament, and the results are worth delving into.

Upsets & Underdogs

For starters, this year’s Final Four, Michigan State, Wisconsin, Duke, and Kentucky, did terribly in RMI’s renewable energy bracket. Of the four teams, only two made it past the first round. National champion Duke, with 1.1% renewable energy incorporated in its energy mix, was taken down in the first round by Robert Morris with just 6.2% renewable energy generation. Kentucky, which was favored to win the tournament this year but was taken down by the Badgers, lost in the first round due to a whopping 0.5%. Michigan State made it through the first round with 3.5%, but quickly lost in the second round to Belmont, with 15% renewable energy generation. Wisconsin, which has the most impressive renewable generation of the actual Final Four with 12%, made it past the first round, but quickly lost to Oregon.

This brings up the next revelation in RMI’s bracket—Oregon is the clean energy national champion. The Ducks were picked due to the 95% renewable energy generation of their campus, beating Eastern WA with 87.7%. The surprise is not that Oregon is the greenest school in the tournament, but that the percentage of clean energy powering the Duck’s campus is incredibly high. 95% is a pleasantly surprising number to see alongside other contenders in the bracket, such as RMI’s winners for the Midwest and East, Texas and UC Irvine, with just 14.6% and 21.6%, respectively.

Keep Playing

The message to take away from RMI’s renewable energy bracket is that this year’s March Madness teams, especially the Final Four, may be great at college basketball, but each could use some work on their sustainability practices and renewable energy penetration back on campus. Some schools, like Gonzaga with 56% and San Diego State with 23.6%, are a breath of clean air. But most schools fall somewhere below 10%, including highly ranked Villanova with 6.2% and Arizona with 5.6%.

It’s also important to note that different rankings produce different results. For example, the Sierra Club’s Greenest American Colleges ranking places UC Irvine as the greenest school in the country due to its ambitious energy efficiency and energy reduction goals, but RMI’s bracket has it losing in the Final Four. Rankings also depend upon different factors that can produce different results. For instance, Kentucky actually has a combined heat and power (CHP) program that generates 18% of its annual energy production, but the generator in this CHP system runs on natural gas and coal. As far as rankings go, should this CHP system be included because the school doesn’t waste the thermal heat produced during combustion, or should it be left out because the generators do not use sustainable resources?

To learn more about ways that colleges can increase their renewable energy initiatives and become more sustainable, check out Navigant Research’s report on Zero Energy Buildings.

 

Spanish Wind Industry Faces Subsidy Cuts

— March 24, 2015

In early 2014, the Spanish government reformed the electricity market by discontinuing the feed-in tariff (FIT) program entirely for all wind plants going forward. The government has also attempted to lower purchase prices retroactively for production from existing wind plants, which essentially means that wind producers who built wind plants counting on tariff-subsidized prices for the next 20 years now abruptly face major revenue shortfalls. A direct result of Europe’s ongoing fiscal crisis in the wake of the 2008 crash, this move is widely considered the most damaging change to renewable incentives in any country globally, and it could result in a permanent wind market collapse across the European Union (EU).

For Spanish wind plant developers, such as Iberdrola or Acciona (ranked as the No. 1 and No. 5 wind operators globally in 2013, respectively), 2014 was a rough year. In its 2014 annual report, Iberdrola announced that it installed only 157.7 MW during 2014. To put that into perspective, the No. 2 company on the list of top 15 global wind operators, Longyuan Power Group in China, installed 1632.7 MW in 2014, and is now likely to surpass Iberdrola as the leading global wind operator. Acciona added 98 MW in 2014, but was forced to sell off 150 MW—thus ending up with less net wind capacity in 2014 than in 2013.

Cash Crunch

The FIT cancellation affected the cash flow of these Spanish companies, as well. Iberdrola’s 2014 profits took a major hit, falling by almost 10% compared to 2013, to hit €2.33 billion ($2.65 billion). In its 2014 annual report, Acciona asserted that, despite the regulatory setback, the company is profitable again and has managed to reduce its debt by €746 million to a still-heavy €5.2 billion ($5.64 billion).

Even if the companies survive this hit, the prospects for domestic development of wind energy in Spain are dire. Companies like Iberdrola and Acciona have the option to go abroad to markets in the United Kingdom, the United States, and Brazil to install wind energy; but for wind development in Spain, there is nothing attractive to investors about joining a market where regulation is uncertain and government support withering. In 2014, Spain installed just 28 MW of wind power, far below the 175 MW installed in 2013. The tariff cut has imperiled the future of clean energy in Spain, unless the government can bring back wind incentives and restart the market.

For a more detailed analysis of Spain’s wind market, as well as the broader global market for wind power, see Navigant Research’s forthcoming World Market Update.

 

Super Sunday: A Victory for Cleantech

— February 8, 2015

On February 1, 114.5 million Americans watched as the New England Patriots defeated the Seattle Seahawks and became victors of Super Bowl XLIX.  However, there was another victory that took place on Super Bowl Sunday, and that was in sports sustainability.

Most people watching the game probably had their attention focused on Jermaine Kearse’s fourth quarter catch, the Snickers Brady Bunch commercial, or gallons of beer and chicken wings.  But did anyone notice the LED fixtures lighting the field, the recycled and green products at the stadium, or the fact that this Super Bowl was 100% powered by renewable energy?

Major Victory

This year was a major victory in terms of energy efficiency and sustainability for the University of Phoenix stadium.  It is the first stadium ever to host the Super Bowl (or any NFL game for that matter) under LED lighting.  The move to LEDs reduced lighting energy consumption – through saved wattage, a lightened load on the air conditioning system, and decreased maintenance – by 75%.  The stadium also gains in added efficiency and reduced consumption through 503 motion sensor lighting controls placed in restrooms, offices, storage areas, and other areas.  As if that wasn’t enough, the stadium monitors real-time electric usage to coordinate demand hours and avoid wasting electricity.  To learn more about energy efficient technologies adopted by the University of Phoenix Stadium, see Navigant Research’s Energy Efficient Buildings: Global Outlook report.

LED lighting and motion sensors are not the only way the University of Phoenix stadium has scored in energy efficiency and sustainability.  The stadium also has an extensive recycling system that generates up to 120 tons of recycled material every year.  And what about those stadium seats?  Every single one is made of 10% recycled plastic.  The stadium scores even higher by stocking environmentally friendly cleaning products and reducing the plastic in trash can liners.

World Class

Finally, the University of Phoenix stadium really demonstrated that a world-class event can indeed be environmentally responsible by teaming up with Salt River Project (SRP – one of the nation’s largest public power utilities that serves Arizona) to provide 100% renewable energy for Super Bowl XLIX.  Although the stadium is not outfitted with solar panels or wind turbines, SRP purchased renewable energy credits from wind farms to offset the estimated electricity demand and greenhouse gas emissions generated by the big game.

So, even if you are disappointed in the Patriots’ Super Bowl win like I am, at least you can cheer for a Super Bowl victory in energy efficiency and sustainability.

 

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