Author Archives: mmm6118

Marielle Martin – Lesson 11 – Decentralization

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Decentralizing power generation will likely increase the implementation of smart infrastructure to the existing grid. The existing grid allows for a simple relationship in which energy producers send energy to consumers. With the influence of decentralization, upgrading the grid will offer the opportunity for an interactive exchange of energy between consumers and producers. In addition, a larger range of energy sources are likely to sprout up across communities, including residential energy applications known as distributed energy resources (DERs). Net metering will be more available in this scenario, making residential energy costs lower for consumers interested in an investment in a DER. These changes will allow companies focused on commercial energy production and residential energy system technology to both find niches. In addition, a need for construction companies to install the expected increase in DERs and energy production infrastructure will emerge.

I would be interested in creating a company that caters to small businesses interested in installing DEPs to net meter and power their businesses. I would choose the either operate in consulting or installation, probably not both – at least not at first. As a consulting firm, the ability to assess a business site (analyzing energy production potential for multiple renewable sources – like wind and solar), predict costs, and coordinate with installation companies would be the bulk of the company operations. However, if I would choose to create an installation company, I would need some ability to market the product and find customers on my own or through a consulting firm of some sort. Personally, the consulting end seems more interesting. I would have less capital to invest in, less people to hire, and greater freedom to run the business in response to public interest, energy prices, and other factors related to the economic viability of renewable energy.

Lesson 8 – Marielle Martin

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I considered this blog assignment from the perspective of a generalized renewable energy company.

Considering what I know about renewable energy, what are some of the key things I need to be able to explain to a potential funder of my project?

Long run outcomes are crucial to ‘selling’ a business idea to a potential funder. Renewable energies are luckily the perfect representative for long run focused projects. Explaining the benefits of an investment relative to competitive enterprises is important. The cost of non-renewable energies will rise a supply falls, and there is little control to be had over supply available. As a renewable energy entrepreneur, that notion, compared to expected growth in renewable energy use and a decrease in cost of implementing renewable energies, is a selling point. Getting down to the ‘nitty-gritty’ is also important to investors though.

What finance-based processes would I use to explain our potential for success?    

Using Return on Investment is a simple, straightforward approach to showing the viability and reason for doing a project, however it does not account for many variables related to taxes and extraneous fees. The Return on Equity accounts for these variables though, and is useful to potential funder persuasion. In addition to simply understanding the return, having an estimate of the value that a project adds to a business is very important. The Net Present Value shows cash flow after a certain period of time from project undertaking. Many renewable projects receive government grants too, so incorporating expected discounts further lowers the time required to achieve positive cash flow.

Marielle Martin – Lesson 3

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The government has the ability to impose policy to incentives and disincentives certain behaviors. When it is a public goods issue, as this one is, imposing these policies is justifiable. A carbon tax is a large scale measure, being heavily analyzed at the present. Dale Jorgenson, and economist who studies the relationships between energy, policy, and environment, spoke in an interview about the tax. He (2014) noted that “a tax of $30 per metric ton of carbon dioxide is equivalent to a tax of 24.4 cents per gallon of gasoline”, which would “raise about $150 billion in revenue for the United States” (Shaw). The article also estimates the world’s yearly costs of climate change impacts to be around $1.6 trillion dollars (Shaw, 2014). With that in mind, the tax is actually hugely discounted to what we actually ‘owe’ the planet. In addition to the carbon tax, policies providing tax credits, grants, or home and business certifications based on energy use thresholds, high efficiency, or low emission/renewable energy source use could be applied. The metrics for these policies may be difficult to accurately measure though, as people have the ability to use a variety of energy options – only some of which require metering/grid connection that is monitored. As a last resort option, government policy could take a glance back in time to the 1970s. Oil economics and foreign power plays resulted in gasoline rationing in the United States. It’s a drastic measure, but there may be a day when such drastic measures are once again necessary. This type of government policy would surely ruffle some feathers over the issues of ‘freedom’ and ‘market economy’. It would span a much more diverse range of energy options to place restrictions on and have social implications on issues like income, standard of living, and access to alternatives.

To develop a business that works through government policy for energy efficiency, I would want to first identify where policy may be viable. I would be inclined to work on designing, building, or installing a measurement technology that could be used in policy aimed to incentivize household efforts for efficiency and minimizing consumption. As I mentioned above, measuring the metrics for which incentives would be rewarded can be difficult, so the prospect of policy only matters if the tools to provide the policy exist. In the hands of private business, innovative solutions for measuring a household’s energy use – even down to the type of energy – may be possible. In the UK, government is promoting smart meter installation in all homes and businesses by 2020 to increase energy conservation (Morris, 2014). The technology developed by Smart Metering Systems monitors gas and electricity consumption, sends the information to energy companies, and provides users with real consumption measurements (Morris, 2014). Smart Metering Systems’ profits have risen by 24% since government promotion began – proving that certain policy has the opportunity to create positive change (Morris, 2014). In addition to the initial energy conservation that users proactively achieve from smart meter installation, policy implementation to reward conservation efforts (by tax credit, grant, etc.) based on energy consumption ‘brackets’ would further increase energy conservation. For example, lower levels of energy consumption would correspond to higher levels of tax credit off of energy spending. The “kilowatt not used is the best of all” would definitely apply for a business working with government policy to conserve energy.

Shaw, Jonathan. (2014, September-October). Time to Tax Carbon. Harvard Magazine. Retrieved from http://harvardmag.com/pdf/2014/09-pdfs/0914-52.pdf

Morris, Jessica. (2014, September 2). Smart Metering Systems Rise on U.K. Energy Savings Plan. Businessweek. Retrieved from http://www.businessweek.com/news/2014-09-02/smart-metering-systems-rises-on-u-dot-k-dot-energy-savings-plan

 

Marielle Martin – Lesson 2

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The government and financial communities have a number of reasons for supporting nuclear energy over renewable energy right now. At the present, there is a sense of urgency in the United States decisions regarding what energy technologies to support. Fossil fuels are still supplying the bulk of all energy in the United States, as well as the emissions. This is a problem that the government is likely hoping to solve quickly and efficiently, which is where nuclear power comes in. Nuclear sources already supply around 20% of the United States energy with only 100 operating reactors (NEI 2014). A high energy capacity factor, at around 90%, also makes nuclear energy more enticing (NEI 2014). The United States has existing infrastructure for nuclear energy delivery, experience with this proven technology, and the ability to deliver a large demand load at high capacity with nuclear energy. Financially, these three factors make it a less risky investment. Essentially, nuclear power funding promises bigger results in the short term than renewable sources can. Renewable energy, unlike nuclear, comes from a diverse mix of sources, making funding it more complicated. Renewable energy sources have much lower energy capacities as well, wind for example, being around 45% (OpenEI). Renewable power is also distributed differently than nuclear is. Individuals and businesses purchasing renewables, like solar, are able to generate the energy for themselves, while nuclear power maintains reliance on a centralized source. This notion has implications on taxes and the economy, so it’s likely that the government and financial investors would be in support of the nuclear industry’s reliability for revenue flow and tax dollars. Overall, there are a few big issues that raise questions about the safety of nuclear power, but the government is highly susceptible to short-term tunnel vision. I believe that the support of nuclear over solar power ultimately comes down to pressure to quickly transition away from carbon intensive fossil fuels, nuclear energy’s proven applicability against the questions of viability for renewables, and a need to ‘do less and get more’ (in terms of capacity factor differences between renewables and nuclear power).

Nuclear Energy Institute. 2014. “US Nuclear Power Plants.” Accessed September 3, 2014. http://www.nei.org/Knowledge-Center/Nuclear-Statistics/US-Nuclear-Power-Plants.

OpenEI. “Transparent Cost Database – Capacity Factor.” Accessed September 3, 2014. http://en.openei.org/apps/TCDB/.

‘Renewable energy sources’ houses a number of technologies under its name. No matter what technologies win favor with consumers and businesses, there will need to be a way to make the energy sources optimally functional. Not everyone is interested in living ‘off the grid’ the way that I am, so I see opportunities in global renewable development in the accessibility of the renewable energy. Many entrepreneurial opportunities exist within achieving accessibility, including grid construction, energy transport efficiency, energy storage on the grid, and energy dispersal (smart grid technology). These opportunities exist primarily in the construction, engineering, and information technology industries. Not only do these opportunities exist, but they are safe. Building pipelines to transport polluting materials from one corner of the planet to another is highly controversial, dangerous, and would be expensive if an accident occurred. However, a grid carrying electricity from much more localized areas than pipelines are used for wouldn’t ruffle as many feathers. It won’t be enough to have the renewable technology, we will need a way to use it effectively.

Marielle Martin – Introduction

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My name is Marielle Martin. I am a senior in the Energy and Sustainability Policy program. For all 22 years of my life, home has been in the Hershey, PA area. My goals, in terms of a career in sustainability, have to do with minimalism and living small. I plan to earn a master’s degree in environmental engineering after graduation, specifically to start a company building micro/tiny homes and other sustainable projects. In fact, I’m working on blueprints and planning for a pilot project home of my own right now. I hope to have my own ‘tiny house’, in under 150 square feet, completed by the time I graduate in a year and a half. This course should be right up my alley based on these interests. I hope this class will serve as a ‘practice run’ for my future business and personal goals.

I have never started a business myself. My parents are self-employed though, running a specialty carpentry business. I have worked on projects with my father and seen a lot that goes into the paperwork and management side that my mother handles. I believe that businesses involved in off-grid, minimalist style home construction, as I plan to get involved in, are very important to advancing renewable energy. These businesses must be well versed in a wide variety of renewable options in order to cater to client needs, climate conditions, and local regulations. Using diverse renewable energy supplies to power both on and off-grid homes will provide people with a feeling of confidence and independence that will help renewable energy gain popularity and prestige as an industry. Additionally, as population increases, open space becomes more limited, and resources run low, smaller more efficient and self-sufficient homes and lifestyles will become increasingly necessary. This transition will create business for ‘tiny house’ construction and the renewable energy industry.