Green power funds to be funneled only to new wind and solar projects

Posted on April 6, 2009. Filed under: Solar, Wind |

From an article by Paul Davidson in USA Today:

The nation’s largest developer of renewable energy today plans to unveil a green power purchase program that could shake up the market by channeling all of the money into new wind and solar projects.

Today, customers who buy green power have no assurances their payments will finance future clean energy projects.

NextEra Energy Resources, a unit of Florida-based electricity giant FPL Group, says it will put all proceeds from the sale of its EarthEra renewable energy certificates, or RECs, into a trust. The company’s auditor, Deloitte & Touche, will ensure the entire trust is funneled to new clean generation, NextEra executives say.

“We found people wanted transparency,” says Mark Maisto, who heads commodities and retail markets for NextEra. “They wanted to know where the money was going, and they wanted the money to make a difference.”

Customers who pay extra for green power often don’t buy renewable energy itself, since it’s almost impossible to zap electricity from, say, a wind farm to a specific home or business. Rather, they buy renewable certificates — commodities that represent premiums above standard electric prices and subsidize a generator for each megawatt hour of electricity it produces. A megawatt hour can power an average house for a month.

The certificates are intended to prod developers to build clean-energy generators, which are more expensive than traditional power plants.

Many of them are purchased by utilities. They often must meet state standards that require them to include a certain portion of clean energy in their power purchases. Thirty-three states have quotas.

A growing number of certificates in recent years also have been bought by consumers and corporations that want to support green power to combat global warming. Sales in this voluntary market jumped at least 30% last year to about 24 million megawatts, says Lori Bird, an analyst at the National Renewable Energy Laboratory. Many of the certificates are sold through brokers.


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