Throughout the state, companies are changing the way businesses and consumers perceive and consume energy, specifically renewable energy sources. In Reno, custom homebuilder Hamilton Homes installs sun roof tiles as a standard feature on its new homes in its Spanish Springs community, Pebble Creek; Henderson-based Aerofortis Energy Solutions Inc. manufactures small wind turbines and other renewable energy equipment; and Infinifuel Inc. powers its biodiesel plant near Wabuska, Nevada with geothermal energy.
As the technology becomes increasingly more affordable, Nevada businesses can make use of the state’s expansive renewable energy resources. In order to take advantage of the supply, state leaders have fostered an environment of support for businesses looking to integrate renewable energy solutions into their daily operations.
“Now we have the ability to mine megawatts instead of just mining minerals. Both of which can be used in Nevada as well as for export,” said Rich Hamilton, president of Great Basin Wind, a corporation that is developing wind energy projects throughout Nevada.
Existing Milieu
Renewable energy encompasses five types: solar, wind, geothermal (the earth’s interior heat), hydro (water) and biomass (organic materials, such as municipal waste). They all are “clean,” meaning they produce few or no hazardous emissions or pollutants and minimally affect the environment. “These are sustainable resources that literally renew themselves,” Hamilton said. “In Nevada, we have great wind, solar and geothermal resources.”
The Silver State’s estimated annual solar power generation potential is 93 million mWh per year, according to the Renewable Energy Atlas of the West, a compilation of existing renewable resource maps and data for the U.S.’ western states. [One megawatt hour equals the energy unit expended in one hour (mWh) at a rate of one million watts.] Large-scale solar projects are primarily in central Nevada and throughout the southern region due to the close proximity to electricity transmission lines. However, the state has ample sunlight throughout for small-scale solar power production.
Much of Nevada is blessed with wind resources, with the ideal spots tending to be in passes where the wind is being funneled, Hamilton said. The state could generate an estimated 55 million mWh of wind electricity per year, according to the Renewable Energy Atlas of the West.
Large-scale wind production requires an average wind speed of 16 mph to 18 mph whereas small-scale wind needs need 14 mph to 22 mph. “There is a window of wind speeds where the resource is enough to be economic but not too much to be damaging,” Hamilton said. As for geothermal power, Nevada can potentially create an estimated 20 million mWh of geothermal power per year, according to Renewable Atlas data. Geothermal zones are concentrated in Northern Nevada, but Southern Nevada contains a few spots. To produce geothermal power, the below ground earth temperature must be least 300 degrees Fahrenheit, said Paul Thomsen, director for policy and business development at Ormat Technologies Inc., a Reno-based company that designs, manufactures and sells geothermal energy production equipment, and owns and operates geothermal power plants.
What Nevada has that California does not is large expanses of undeveloped land, which is typically owned by the U.S. Bureau of Land Management. California is also rich in solar, wind and geothermal resources, but it does not have the space in which solar and geothermal energy could be created, said Michael Skaggs, executive director of the Nevada Commission on Economic Development (NCED).
By 2015, Nevada Revised Statues (NRS) mandates that electric service providers achieve a 20 percent Renewable Portfolio Standard (RPS) — the amount of electricity generated, acquired or saved from renewable energy systems or efficiency measures. To comply, NVEnergy plans to spend approximately $2 billion dollars between 2007 and 2015 to purchase and invest in additional renewable energy.
“They’re moving forward at a pretty fast pace,” said Chris Brooks, director of Las Vegas-based Bombard Electric’s Renewable Energy Division. This division of Bombard Electric installs solar, electric and wind power generation systems throughout Nevada for primarily commercial and large industrial enterprises.
In addition to the state mandates, Nevada’s leaders and the NCED believe that a truly varied state economy can be attained by capitalizing on local renewable energy resources.
“I know when I see the key ingredient to turning a state’s economy around,” Skaggs said. “Now that we’ve more or less come to the realization and have a president who’s leading the parade, this is our day to build that diverse economy we’ve talked about since 1983. We’re going in a green direction as a nation, and I would love to see Nevada have a front row position in embracing a green economy.”
Nevada is already on its way, creating both solar and geothermal power on a large scale. It ranks No. 1 in the country for generation per capita of these two energy types.
Opportunities for Businesses
It is now possible for Nevada’s businesses to create some or all of their own power to offset electricity costs and perhaps even selling energy back to the utility company. “That’s probably one of the big waves that’s coming—more and more people generating power for their house or business and getting off the [electrical] grid,” Skaggs said.
There are various options for generating one’s own power. One is a photovoltaic or electric solar system, which captures and converts sunlight into electricity. The Las Vegas Springs Preserve parking lot, for example, has an electric solar system that makes about 400 kW of power. These systems cost about $8 to $10 a watt to install, said Mark Harris, resource planning engineer for the Public Utilities Commission of Nevada’s Division of Resource and Market Analysis. A 30-kW system, which would suffice for a small- to medium-size business, would cost about $250,000.
Less expensive, solar thermal systems harness the sun’s energy for heat. Applications include heating spaces, such as through radiant flooring, along with heating domestic hot water, pools or spas. “They have tremendous value, especially in places using electricity to heat water right now,” Brooks said.
A third kind of solar power generation, used solely for commercial-scale production, is concentrating solar power (CSP). These systems produce electric power by converting the sun’s energy into high-temperature heat using various mirror configurations, Brooks said. The only energy plant using this technology in the state is Nevada Solar One, a Boulder City-based, 64-mW generator of CSP.
Small wind systems, which capture the kinetic energy in wind and convert it into electricity, are another option for certain businesses. Companies using less than 3,000 kWh of power a month need about a 1- to 10-kW system whereas companies with greater power consumption require one in the 50 to 100 kW range, Hamilton said. Installation costs for a 2-kW turbine is about $15,000 to $18,000 and for a 100-kW system, between $150,000 and $200,000. In January, Bombard Electric installed a 2.5-kW wind turbine on the back side of the Cathexis Architecture Building in Reno (home to both Hamilton’s office and Brooks’ Reno location), which creates a portion of the building’s total required energy.
“Wind is the most affordable power generation out there,” Hamilton said. “If you have a good wind resource at a business, it’s a great investment.”
Generating large quantities of wind power can be ideal for farmers and ranchers living in Nevada’s rural areas. Currently, no utility-scale wind power plants exist in Nevada, however, at least 14 have been proposed. One is Great Basin Wind’s New Comstock, an estimated 200-plus mW plant located in the Virginia Range between Carson City and Reno, which could go online between Fall 2010 and Spring 2011, Hamilton said.
For a company to generate large-scale wind power on a piece of land, they’d have to either own or get the rights to operate their plant on the property.
Geothermal power production involves converting heat from the earth into electricity. Businesses located on property containing the necessary 300-plus degree Fahrenheit temperature, could consider large generation of geothermal power. Ormat Technologies owns and operates 10 such power plants ranging from 250 kW to 560 mW, and has three under development in Nevada—all in the northern region.
For those companies built on spots with a temperature of less than 300 degrees Fahrenheit might consider installing a ground-source geothermal heat pump (GHP), which uses hot water from the ground to heat domestic water and spaces or use in other ways. For instance, at its spice processing plant near Empire, NV, Integrated Ingredients uses about 265-degree Fahrenheit, geothermal water to dehydrate onions and garlic.
Unlike solar and wind power plants that produce power intermittently, geothermal ones generate electricity constantly. Accordingly, 100 mW of geothermal power produces several more megawatt hours than a solar or wind power plant.
“Geothermal plants produce a huge amount of power for the state and yet, they have a small economic impact and zero emissions,” Thomsen said.
Some industries that use mass quantities of heat in their processes, such as cement kilns or natural gas processing plants, can recover and convert, with no new emissions, the wasted heat into additional electricity. Ormat Technologies, which manufactures equipment for recovered energy generation, is working with NVEnergy on the first such project in Nevada called Goodsprings, a compression station located in Goodsprings, Nevada.
Companies considering generating or recovering renewable energy should first consider energy efficiency strategies to reduce their total load, Brooks said. To aide that initiative, NVEnergy offers incentives for certain efforts.
“As exciting as renewable energy is, conservation—the kind of energy you don’t use at all—is the best kind,” Brooks added.
The Resulting Benefits
The economic benefits in Nevada for using renewable energy are immense, Hamilton said. For instance, the estimated economic benefits from 1000 mW of new wind development in Nevada is about $1.1 billion, according to Great Basin Wind.
“It helps businesses by surviving in a stronger state economy,” Hamilton added.
Renewable energy generation at home increases state and local tax revenues—a boon for rural towns, in particular. For instance, in 2006, Ormat Technologies paid more than $2 million in state taxes from its geothermal development. The solar, wind and geothermal power sector also creates high-paying jobs, not only in large metropolitan areas, but also in small rural towns. Just one example is trained solar and wind installers who can earn $70,000.
Renewable energy also levels out companies’ energy costs whether they are creating it themselves or are relying on the grid, Hamilton said. The more renewable energy that is added to the grid, the more affordable energy becomes. This is because the costs of renewable energy production do not fluctuate as non-renewables do and therefore can be predicted with a degree of certainty.
“We’re very good at knowing what our power is going to cost our rate payer,” he added.
An additional benefit of introducing renewable energy into business operations is the right to claim and market themselves as green companies.
Various Incentives
Federal and state incentives, in the form of rebates, tax credits, depreciation deductions, property tax abatements and exemptions, are available to companies investing in renewable energy generation to encourage these types of investments. Each incentive has specific requirements and limits.
“The rebates and tax credits help a lot,” Brooks said. “There wouldn’t be a solar industry in this state without the rebate program, NVEnergy’s involvement and the tax credits.”
Since SolarGenerations, a state rebate program for solar power-generating projects began in 2003, approximately 260 such projects that together produce more than 2 mW of energy, have been completed; a similar program for wind, WindGenerations, launched in 2008. Individuals and businesses should apply for a rebate during the designated periods before having their system installed. The application will be put on a waiting list until all prior applicants are processed, but the applications are typically honored even though there is a waiting period.
“Everybody who has ever wanted to get a rebate gets it,” Brooks said. “It just takes some time to move through the process.”
An alternative to the SolarGenerations or WindGenerations rebates is renewable energy credits (RECs). One REC is given per kilowatt hour of wind, geothermal or off-grid photovoltaic power generated; 2.45 credits are given per kilowatt hour of grid-connected photovoltaic power generated. These RECs can be sold to utility companies in or out of the state. Those who opt to receive the RECs cannot get the rebate and vice versa.
“Most people take the rebate because it’s cash up front,” Harris said.
A solar thermal rebate program will likely be established by year’s end, Harris said. No incentives currently exist for recovered energy generation.
“I think we’ll probably see more federal and state credits,” Skaggs said.
Some available federal loan and grant programs can help businesses fund their renewable energy projects.
Proposed Legislation
Key legislation for renewable energy production that is slated to be introduced in the upcoming session centers on adding access to the electrical grid system. A modernized and improved grid infrastructure will allow for more renewable energy industries throughout the state, as currently large-scale production is limited to regions close to power transmission lines. The improved infrastructure will also create access to markets in neighboring states, thereby enabling export.
“Building more transmission gets you the most cost effective energy to your business and home,” Hamilton said. Governor Jim Gibbons’ Nevada Renewable Energy Transmission Access Advisory Committee (RETAAC) has developed maps for and recommended 14 additional power transmission lines for Nevada. It now must address physical and environmental feasibility issues, costs and potential financing mechanisms associated with those lines.
The first phase of the transmission lines is already under way. The Southwest Intertie Project, slated for a 2011 completion, involves installing a 234-mile, $350-million transmission line that would directly link the state’s electric utilities in Southern and Northern Nevada for the first time. Later, that line would be extended north from Ely to Idaho, and additional lines would lead into Utah and California.
Nevada’s Future in Renewables
Those in and knowledgeable about the renewable energy industry have great expectations for Nevada. Bombard Electric’s Brooks would like Nevada to remain number one in solar power production per capita in the United States.
“I’d love to see Nevada keep up with California,” he said. “From what I see happening with our state Legislature, elected officials and utility, I think it is possible. They’re doing some pretty exciting things.”
In 10 years, Hamilton, of Great Basin Wind, would like to see Nevada having met the national goal of generating 20 percent of available energy from wind, he said. Also in a decade, Nevada should not only be renewable energy self-sufficient, but also selling solar, wind and geothermal power to outside markets, he said.
Skaggs, with the NCED, wants Nevada, by 2020, to have achieved a global reputation as “the innovation center of ideas that are solving the planet-wide energy crisis,” he said. “There is a very real opportunity for Nevada to be a major force in the renewable energy sector.”
