The weather’s warming up, which for many people means it’s time to hit the beach! While you’re out, you may notice a few things: the heat of the sun, the warm breeze, and the waves and tides that make playing in the ocean so fun. Not only are all three of these natural processes key ingredients for a wonderful day (or week!) off, they are also powerful sources of renewable energy. In this article, we look at how sun, wind, and waves generate power and their relative advantages and disadvantages to each other, so you can make an informed decision for your business. It’s summer! So sit back, relax, and let Holocene do the legwork for you.

Solar

Overview

The sun’s energy isn’t just a way to work on your tan – it’s heat can be converted into electricity for human consumption. Solar comes in two main types: thermal and photovoltaic. Thermal solar systems use the heat of the sun to run a heat engine that turns a generator and thereby produces electricity. Photovoltaic panels directly convert the sun’s light into energy. Solar panels can be ground mounted or roof mounted, and can be done on a large scale and sold into the grid (utility scale solar), or can be installed on individual homes and businesses in a distributed generation model. Most of the nation’s solar plants can be found on the East Coast (especially North Carolina, PJM, and New Jersey), Southern California, and the Southwest, with companies such as Ikea and General Motors investing in solar energy. Ikea has almost 700,000 solar panels on its stores and distribution centers worldwide, and General Motors uses a total of 48 megawatts of solar power spread across 22 facilities. Solar Power Purchase Agreements (PPAs) typically last 15-20 years. While solar is more expensive than wind (as of 2017, the levelized cost of electricity, or LCOE, is at USD 0.10/kWh for photovoltaics and USD 0.22/kWh for concentrated solar power), prices have been dropping consistently and rapidly over the last decade, with solar prices nearing those of wind and expected to drop even further as technology improves. Solar is a great choice for companies looking for versatility in their power portfolios, as solar can be installed almost anywhere and projects can vary in size, allowing companies to decide to buy all their energy from a single large solar source or to use smaller solar projects to supplement their energy portfolio. This also makes solar a great choice for smaller companies who don’t need the power provided by a 50 MW project, with many smaller sizes of solar projects on the market.

Pros

• Low O&M (operation and management) costs
• Can help offset peak loads, so less brown power is required to meet demand
• No emissions from energy production
• Rapidly decreasing costs
• Not very site-dependent

Cons

• Less effective on cloudy days
• Can’t generate power at night
• Requires considerable free/open space to produce sufficient amounts of energy
• Higher upfront costs (these are dropping rapidly, but still may be affected by the dissolution of subsidies)

Wind

Overview

In the not so distant future, you may go to the beach and see, far out in the water, wind turbines that generate energy using the same wind that gently ruffles the corners of your beach blanket (and gets sand all over everything). While many people default to onshore turbines when thinking of wind power, wind, like solar, comes in two main types: onshore and offshore. Onshore refers to wind turbines located on land, while offshore refers to turbines located in water. This water can refer to either the open ocean or a body of freshwater. When the wind blows, it turns the turbines; their turning is what generates electricity. Turbines themselves come in two types, Horizontal Axis Wind Turbines (HAWT) and Vertical Axis Wind Turbines (VAWT). HAWTs are the most common, especially for commercial use, while VAWTs are commonly used for individuals and businesses and in places where the wind may be too turbulent for HAWT use as they sustain damage in high-velocity winds. Most wind projects are found in the Midwest, Texas, and New England. Major companies such Adobe and Nike use wind as part of their renewable energy portfolio, with Adobe signing a PPA for a 320 MW wind farm which also signed a major PPA with Facebook, and Nike signing its second major wind PPA for an 86 megawatt project in Texas in January 2018. Wind PPAs are typically 15-25 years, with the LCOE at USD 0.06/kWh as of 2017. While wind has traditionally been cheaper than solar, falling solar prices, combined with solar’s low impact on the visual landscape and ability to be installed in areas wind turbines cannot be installed, such as urban environments, have caused corporations to think beyond wind for their renewable needs. Wind has a few more geographic limitations than solar, and is considered at least, if not more, consistent. However, while solar panels convert light into energy even on a cloudy day (albeit in much smaller amounts), large turbines don’t blow in a slight breeze. A company set on having on-site power may shy away from wind, as HAWTs require wide, open spaces and VAWTs, while they can be installed on buildings, produce less energy than HAWTs.

Pros

• Minimal emissions from installation
• Rapidly decreasing costs
• Low upfront costs

Cons

• Least predictable renewable energy source
• Can be expensive without subsidies
• Some consider turbines an eyesore
• RP Siegel at Triple Pundit notes that there is concern that turbines can interfere with wildlife such as birds and bats and affect local nighttime temperatures and weather

Waves

Overview

You may be no stranger to the idea of wind and solar, but the movement of the waves you love to splash in or the tides that force you to move your beach chair halfway through the day can also be leveraged for human use. There are several ways to turn the movement of water into energy, known in the renewable world as hydropower. Wave power, which uses the movement of waves to create electricity, is dependent on wind, and is sometimes considered part of overall wind power. Tidal power depends of the movement of the tides, which is linked to factors such as Earth’s rotation, the movement of the Sun and Moon, and the shape of local terrain. The third type of water-based renewable power generation is hydroelectric power, which is most commonly procured through dams. In hydroelectric systems, energy is produced by the movement of water through turbines. Dams are one of the most recognizable styles of hydropower production in the U.S. and are often built of rivers and lakes. Power can also be generated through river diversion, which does not require a dam. Hydropower is found almost everywhere, with the lowest concentrations in Nevada, New Mexico, and Texas. PPAs vary greatly in length, anywhere from 5 to 40 years, and are typically signed between developers and utilities rather than companies on large-scale projects. Hydropower itself is on the whole cheaper and more efficient than solar and wind the 2017 LCOE for dams at USD 0.11/kWh or less, but it suffers from other barriers. Dams are expensive to build, technology for wave and tidal power is relatively new and not as efficient as dams or pumped storage, and all three are geographically limited, as dams need a river and tides and waves need the ocean or other sufficiently large bodies of water. While not as common as solar or wind, there are few small-scale hydropower companies in the U.S., making hydropower a great option for companies looking for smaller amounts of renewable energy or who are trying to build a diversified energy portfolio.

Pros

• Power from hydroelectric dams is among the most reliable of renewables
• Wave energy is less variable than wind
• Tides are more predictable than wind or solar

Cons

• Wave and tidal power is site dependent, meaning that it is very effective at a good site, but sites may be difficult to find and cannot be set up just anywhere
• Dams are one of the most expensive forms of renewable energy in terms of capital expenditures
• Tidal power has high upfront costs
• Dams can harm the surrounding environment by disrupting riparian areas and degrading water quality

Conclusion

So there you have it! Next time you’re on vacation, look around and take in how many natural processes occurring around you have potential for untapped power. In the meantime, what we’ve learned from our beach adventure is that while all three major sources of renewable power have their advantages and disadvantages, solar offers the most flexibility and reliability with low lifetime cost. For a more in-depth exploration of the pros and cons of various renewables, including charts and statistics, check out Solar DAO’s article on Medium. If your company is looking to make a move to solar, contact Holocene Clean Energy for a complimentary assessment of your energy needs and options.

If you’re a data center owner or operator, you may be considering a shift to renewable energy. Many industries are integrating renewables as prices drop and demand for sustainability increases, and the data center industry is no different. In fact, industry experts such as Kevin Hagen, Vice President Environment, Social & Governance (ESG) Strategy at Iron Mountain, assert that while the data center and colocation industry is a small segment of the IT sector, it represents a large portion of the power consumption and therefore needs to consider the environmental impact of living in a digital world.

“Look at the top ten EPA Green Power Partner list, and you will see wholesale colocation customers like Microsoft, Google, Intel, Apple and Cisco leading the way. Earlier this year, an article was released on a large provider of streaming content that required 100 percent renewable energy as a core component for their data center RFP,” writes Hagen.

So, exactly how can renewable energy developers help data center operators expand their renewable portfolio? David Chernicoff at DataCenterDynamics.com calls attention to the fact that data centers can fulfill their claim on sourcing renewable power through the use of renewable energy certificates (RECs) and power purchase agreements (PPAs).

When a renewable energy developer brings an asset online, they may sell their RECs to companies looking to offset their brown energy use, with one REC equaling one megawatt hour of consumption. The REC gives the purchaser ownership of the environmental attribute of renewable energy production, allowing them to claim the environmental impact of the generated energy without having to be physically connected to the renewable system itself. There are several advantages to RECs: companies don’t have to be directly connected to a grid supplied by the renewable asset; they don’t need to build and maintain a capital-intensive, on-site renewable asset; and they can promote their commitment to renewable energy. Finally, RECs may be the only available option in certain areas of the country where other renewable energy options are unviable.

However, REC-only contracts have some limitations. First, they are an added expense. The RECs are only certificates; they are not purchases of usable power, so the price of the REC is an added expense on top of the price of power. Second, the purchase of RECs alone may not help to create what the industry refers to as “additionality,” or the creation of a new renewable energy source. Proponents for the distinction argue that new renewable energy projects cannot be financed and built without a green power purchase agreement. When a company purchases RECs, they have the legal right to claim the environmental attributes of the generation, even if they did not help to finance, build, or bring the renewable power generation asset online.

Another option for data centers looking to become more sustainable are longer-term PPAs. Like RECs, the purchasing company does not need to be directly connected to the renewable energy source to be able to claim that they are powered by renewable energy. However, since PPAs are contractually tied to the renewable energy generation either through a physical PPA or a virtual (financial) PPA, it is this long-term contract with the new project that creates the additionality that REC-only contracts do not. When companies sign a PPA with a new construction, they are ensuring that clean, renewable energy is added to the grid, whether they are the direct user of the energy or not. This distinction may be important to companies who are looking to use their renewable energy or carbon reduction commitments to differentiate themselves from their competitors.

Over the past few years, America has seen a number of its largest companies switch their energy consumption over to 100 percent renewable sources.  Back in the early days of solar and wind, firms like Google, Apple, and Walmart sought power purchase agreements (PPAs) from renewable energy developers to help meet their (mostly self-imposed) corporate sustainability goals.  Being large companies with “deep pockets”, Google et. al were not necessarily concerned with the short-term economics associated with purchasing renewable energy and, instead, decided they could reconcile the financial impact by attracting new customers and increase their top-line revenue by “going green”.

Up until recently, the conventional thinking among corporate energy purchasers was that pursuing a renewable energy PPA only made sense from a “good will” perspective and the financial justification for executing one was “shaky” at best. However, with the considerable advances in technology and manufacturing, the cost of solar has decreased to a point to where businesses much smaller than Google and Apple can confidently justify the transition to renewables and, as a result, actively manage their energy costs. The question then becomes: exactly what financial advantages do today’s PPAs offer to corporate energy buyers?

In their white paper entitled “The Economic Case for Renewable Energy”, John Powers and Amy Haddon of Renewable Choice Energy present three considerations for why PPAs make perfect financial sense for commercial and industrial (C&I) businesses. These include:

• A bottom line impact – Technology-based power generation, which is not dependent on the fluctuating price of fossil fuels, allows renewable energy developers to offer a fixed-price to their corporate off-takers.
• Short position exposure – Electricity prices are dependent on the energy supply, coupled with demand, and they tend to have seasonal peaks. In many markets it is impossible to purchase electricity more than 2-3 years into the future, which subjects corporate energy buyers to fluctuating market prices over the long-term. Renewable energy PPAs allow for much longer pricing terms which insulate buyers against these fluctuations.
• Financial risk management – Most industry experts would agree that the future direction of government regulation relative to carbon footprint is unpredictable. Future directives, such as an imposed carbon tax, could economically hinder organizations to a dramatic degree.

Likewise, Sunpower, a leading US-based manufacturer of solar panels, puts forth in an article, Understanding Commercial Solar Financing Options: Power Purchase Agreement (PPA), several data-based PPA financial advantages that speak directly to corporate energy buyers. They include:

• $0 capital investment: There is usually no upfront costs associated with entering into a solar PPA.
• No ongoing operations and maintenance (O&M) costs: The energy developer pays for the O&M of the solar system, not the energy buyer.
• No production or performance risks: Under a PPA, the corporate energy buyer does not incur any expenses whatsoever if the renewable system does not produce energy because of damages caused by nature or other unforeseen events.

Are you an energy buyer for your organization who is trying to determine whether executing a renewable energy PPA make sense? Here are two solid reasons why we believe you should give it serious consideration:

Solar PV technology costs continue to drop: According to GTM Research and the Solar Energy Industries Association (SEIA), the unit cost for solar (in $ per watt) has decreased 80 percent from 2009 levels and continues to drop. Furthermore, the justification for executing a PPA has never been more financially compelling and is no longer a prickly conversation with senior management.

Meet Your Sustainability Goals…Without the Headaches:  Solar PPAs enable your business to take advantage of clean, renewable energy, actively manage your energy costs, and avoid all the O&M expenses associated with keeping a renewable asset in service. Additionally, PPAs can be easily be tailored to meet the specific financial needs of your business.

When looking to buy energy, keep in mind that an experienced renewable energy developer will be uniquely positioned to adequately address your PPA concerns and successfully guide you along your journey to an expanded renewable portfolio. Holocene Clean Energy finances, constructs, and sells complete solar PV systems and executes PPAs for smart energy buyers. As such, Holocene fully engages itself in the entire solar project lifecycle and is able to offer clients a streamlined and seamless renewable energy sourcing process from an engineering, business and legal perspective.

Kathy Miller, co-founder and CEO of Yes Solar Solutions, is one of the foremost female entrepreneurs in the North Carolina solar industry. In honor of Women’s History Month, we asked her to give some insight into how the solar industry is changing, and where women fit into the picture.

Holocene Clean Energy: How have you seen the solar industry change over the years, both for women specifically and overall?  

Kathy Miller: The solar industry, unfortunately, has not seen as much change for women as we might have expected.  When we founded Yes Solar Solutions in 2009, I was the only woman in the building for quite a few years (although we were a pretty small team).  We did add a female solar installer who held her own and got NABCEP certified within two years, and our Director of Finance is a woman. I have noticed more women in renewable energy conferences and on boards over the last few years. The industry is maturing to a degree, which means our workforce is maturing.  When we started we were a team of mostly young, white male recent college graduates. Increased diversity has resulted in our company including more people of color, [and] more diverse work experience in trades like roofing, electrician, and construction. Where everyone in 2009-2013 was young, we have seen our team get married, have children, buy houses and need more work life balance and higher incomes.  Providing health insurance used to be relatively inexpensive with just young males, but including spouses and children has increased cost. Our 401K used to be a small piece of our cost, but with a larger group and higher salaries, those costs have risen dramatically. Ultimately, it is up to women leaders in solar to make room for more women in solar.

HCE: What will it take to get women in solar?  

KM: Ultimately, it is up to women leaders in solar to make room for more women in solar. As our company human resources manager, among other hats I wear, I post jobs, vet resumes, interview and hire.  I wish I got more resumes from women, but I do see more women choosing degrees that will ultimately result in more women in solar. And as solar companies grow, there is more room for jobs not requiring specifically solar experience or education:  project coordinating, law, marketing, finance, design, administrative (unfortunately often categorized as women’s occupations). Women getting a foot in the door in those roles are learning more about the solar business and advancing, our own Director of Finance, Bethany Theede, being a good example.  She started as an administrative assistant, although with a degree in Environmental Studies, and of her own initiative, took on the interconnection process, eventually our accounting, and is now our go-to for job costing, profit and loss statements, and an integral part of our Leadership Team.

HCE: Do you have any bold predictions for the solar industry?

KM: I don’t know how bold my predictions are, since every day there are new developments in renewable energy that are both challenges and blessings.  The challenge posed by the tariffs, for example, being announced within a week of Duke Energy’s proposed rebates. Tax credits pumping contracts in and then expiring.  But I see opportunity everywhere, from energy storage to products that may make a whole roof solar, to technology we haven’t even seen yet. Yes Solar Solutions is on the energy storage bandwagon, having been the first certified Tesla Powerwall installer in North Carolina and we are installing them as fast as we can get them.  Consumers are interested in having some independence from the utilities, and are willing to pay for it. They are also the biggest advocates for renewable energy and that segment gets larger every day. Despite the challenges of the “solar coaster” solar is not going away.

Learn more about Kathy’s journey into solar and her entrepreneurial spirit in Yes Solar Solution’s International Women’s Day Post: https://www.yessolarsolutions.com/news-and-updates/international-womens-day-woman-owned-small-business/