Today, more than 300 utility companies offer consumers the option of purchasing renewable wind power energy—most commonly electricity generated by the wind and to a lesser degree renewable energy produced from solar or biomass sources. In the past four years, participation in such programs has grown at an average of 20 percent monthly. Nationwide, corporations such as Nike, Patagonia, Toyota, Kinko’s, Fetzer Vineyards, Clif Bar, Ben & Jerry’s, and even the U.S. Postal Service purchase renewable energy. Anyone who pays an electric bill can do the same, regardless of where you live or who you buy electricity from. In most cases, it’s as simple as a phone call or a few clicks on the keyboard.
Does that mean that the electricity humming through the lines to your home will come directly from a wind farm? Not exactly. In fact, the only people who can be certain their electricity is generated by wind are those with a windmill in the backyard. And that’s where some people get confused.
How it works
To make sense of wind power, says Susan Peterson, a vice president at green energy marketer Renewable Choice, you have to first understand how the distribution of electricity works. “At the top of the food chain are the power producers, who sell energy to a power broker like Enron,” she explains. “The brokers regulate the flow of energy on the national power grid. Utilities buy energy from the brokers and sell energy to their consumers.”
Peterson likens the energy grid to a big pool of water filled by many different types of energy. According to the EPA, coal contributes 52 percent to the pool; nuclear 18 percent; natural gas, oil, and other fossil fuel 18 percent; and large hydroelectric 10 percent. About 2 percent is from renewable energy sources such as wind, solar, geothermal, small hydro, and biomass. When you turn on a light, you tap into whatever mix is in the pool. “If we all decide we want only clean power put back in the grid to replace coal or nuclear, the pool gets cleaner and cleaner for everyone,” Peterson says. “It’s like vegetable soup. If you keep putting one kind of vegetable in—say potatoes—eventually it becomes potato soup. The more wind power that goes into the grid, the cleaner the electricity becomes for everyone.”
In Austin, Texas; New York City; Sacramento; Portland, Oregon; Denver; and Madison, Wisconsin, choosing renewable energy is as simple as calling the local electricity provider. In some instances, the utility owns a renewable energy facility; in others, the utility purchases green energy from another source.
Those who don’t have the option of choosing renewable energy from their local utility can purchase “green certificates,” also known as “green tags” or renewable energy credits. The certificates, sold by independent marketers such as Renewable Choice Energy, Bonneville Environmental Foundation, and Community Energy, are used to replace energy generated from conventional sources with renewable energy generated by renewable sources. The certificates serve two purposes: They lend financial support to the renewable energy facilities while ensuring that green energy is generated.
“By buying green certificates, you’re enabling a renewable facility to generate electricity,” explains Lori Bird, senior energy analyst with the National Renewable Energy Lab. “It often costs more to generate power from that plant than a conventional facility. The renewable generator needs to get the extra income in order to run.”
Say for example that renewable energy costs five cents per kilowatt hour to generate. The facility might sell the electricity to the utility or a power exchange for three cents and sell the certificates through a third party for two cents. In that way, the renewable facility has recouped the cost of generating clean energy.
Certificates can be purchased for 100 percent of the consumer’s electricity usage or only a portion. The consumer gets a bill from the local utility as usual, the only difference being that he or she now pays a premium to a marketer for the certificates. Look for marketers who are audited by the Center for Resource Solutions to ensure compliance with environmental standards.
“When they buy certificates, marketers like Renewable Choice are buying the environmental attributes of the renewable facility,” Bird explains. “Essentially, one renewable energy certificate represents the environmental attributes of one kilowatt hour generated by the green energy facility.”
Buying a certificate or choosing the renewable energy option directly through your local utility are equally beneficial. At issue is where the renewable facility is located. “People who are concerned about air quality should understand that when they buy renewables from distant facilities, they won’t benefit locally from air quality improvement,” says Bird. “However, they are still helping reduce global warming because the renewable facilities are not emitting CO2.”
The true costs of renewable energy
While the United States has made significant strides in recent years toward increased use of clean energy, only 1 percent on average of the nation’s utility customers have signed up for greener options. In the past, reluctance to support renewable energy could be attributed to the higher cost. According to Bird, in 1980 wind energy cost about forty cents more per kilowatt hour than energy from conventional sources. Today, the surcharge for green power ranges from 1 to 2.5 cents.
In Austin, it’s not farfetched to think that one day GreenChoice customers might pay even less, says Mark Kapner, manager of Conservation and Renewable Energy for Austin Energy. “Unlike the 300-plus other green energy projects, almost all of which charge the customers a surcharge, ours was the first to essentially use the pricing of the green energy as a hedge against inflation,” he says. “Each customer’s electric bill shows the cost of the fuel for the power plants—the price the utility pays for its coal, nuclear, and natural gas per unit of electricity—multiplied by the customer’s usage. That fuel price is periodically adjusted up or down to reflect our actual cost. Lately, it’s going up. We’ve announced three fuel price increases over the next six months. The GreenChoice customers don’t pay a fuel charge; they pay a green choice charge—guaranteed not to go up until at least 2011 because our wind and bio-energy contracts have a locked-in price until then.”
By January, Kapner expects the difference in cost between renewable energy and energy generated by conventional methods to be roughly 1/20 of a cent. “At the very least, GreenChoice customers know what price they’ll be paying for the next eight years; the conventional fuel customers don’t,” he points out.
Of course, the biggest benefit is to the community in general: Every electron produced by renewable energy means one less made from fossil fuels. “We are throttling back on our fossil-fuel-burning power plants in proportion to the amount of wind energy being produced,” Kapner says. “That means that even though the wind energy is being produced in west Texas, the air in Austin will be cleaner because we’re burning less fuel.”
The flip side
Not everyone believes wind power is a panacea. Historically, critics have argued that wind turbines kill birds and create noise. However, Bird says, those issues have diminished over time as improved technology and better siting practices enable wind developers to build quiet wind farms on sites that don’t coincide with migrations. “Although a few birds die from flying into the turbines, there hasn’t been a large-scale bird kill from a modern project,” she reports.
Nowhere is the battle against wind power louder or more vigorous than at Cape Cod, Massachusetts, where a plan by Boston developer Cape Wind Associates would place 130 wind turbines, each 417 feet tall, in the Nantucket Sound. Alliance To Save Nantucket Sound executive director Isaac Rosen says his organization doesn’t oppose wind energy, but that the location of the turbines would be a blight on the horizon and would disrupt fishing and tourism. “We embrace renewable energy,” he says, “but the ocean belongs to everyone in America, and we should not be quick to give away these public resources to private developers who simply want to make a buck,” he says.
Despite some of the controversies regarding wind power, this renewable source of renewable energy is likely to play a large role in the future. “There are problems with any energy source,” notes Kapner. “However, I’m optimistic about wind power. It’s the lowest cost domestic option we have, especially with natural gas as expensive as it is or more expensive in the future. The potential is there for wind to make a substantial contribution to the country’s energy.”
Measure the returns
How will your choice to support renewable energy change the world? Here’s a quick way to find out.
With a recent electric bill in hand, go to RenewableChoice.com and click on the “sign up” option. On your electric bill, find the kilowatt hours your household uses per month, enter it in the appropriate box, then click on “access impact.” In seconds, you’ll know how much green certificates will cost you and how much pollution you’ll be saving the earth.
For example: A household purchasing 660 kilowatts of green energy per month will pay an extra $26.40 a month and save 12,038 pounds of carbon dioxide and 39 pounds of nitrogen oxide from entering the atmosphere. That’s equivalent to planting 1.34 acres of trees or not driving 13,171 miles.