PG&E gets into the energy generation game (wait a minute, isn't that illegal?)

Now hoooold on just a minute, can this really be happening? In exchange for a whole lot of public oversight and regulation PG&E gets to be the major player in the energy distribution game in Northern California. That's the deal they made some time ago. They are not permitted to produce and sell energy on the retail level.. So how can this be?

Wednesday, January 20, 2010, 6:55am PST  |  Modified: Wednesday, January 20, 2010, 9:54am

PG&E, SolarCity partner on solar

San Francisco Business Times - by Lindsay Riddell

PG&E is officially financing solar.
Under a partnership announced today, a financing arm of Northern California utility owner PG&E Corp. will provide $60 million in tax equity financing for about 1,000 solar systems installed by Foster City-based SolarCity. This is the first partnership of its kind between a utility and a solar installer.

Tax equity financing helped drive major growth in the solar industry in years past. The federal government offers a 30 percent tax credit for renewable energy projects but only companies that make a profit can use that tax credit.

Most solar companies don’t have the capital to finance projects themselves so they use tax equity partners — often banks — to essentially buy the tax credit off of them at a discount and provide capital upfront to pay for solar projects.

However, when the recession hit, few tax equity financers were profitable enough to use the tax credit, and that stalled solar projects as companies struggled to find scant available sources of capital.
Utilities had been barred from using the federal tax credit for renewable energy but were empowered to do so to finance renewable energy under new regulations passed in the federal stimulus bill in 2008.
PG&E announced in 2009 that it would develop 250 megawatts of distributed generation — solar power near transmission lines — within its service territory and bid another 250 megawatts out to the public.
PG&E is paying for the projects through its financing arm Pacific Venture Capital.
Homeowners both within PG&E’s electricity service territory and in the rest of the state, Arizona and Colorado, will have financing options including leases and power purchase agreements offered by SolarCity.
“SolarCity strongly believes solar companies and traditional energy industry players must work together if solar power is to become a mainstream source of electricity in America,” said Lyndon Rive, SolarCity’s CEO.
Started in 2006, SolarCity has 1,700 solar customers in Pacific Gas and Electric Co.’s service territory and 5,000 solar customers total.

Email Lindsay Riddell at lriddell@bizjournals.com / (415) 288-4968

Will Google get into the PPA game?

The New York Times

January 7, 2010, 8:23 pm

Google Applies to Become Power Marketer

By MIGUEL HELFT

Google is stepping up its forays into the energy world.
The Internet search company, which consumes vast amounts of electricity to run the computers in its data centers, created a subsidiary last month called Google Energy. It then applied for approval from the Federal Energy Regulatory Commission to be allowed to buy and sell power much like utilities do.
Google said it did not have specific plans to become an energy trader and that its primary goal was to gain flexibility for buying more renewable energy for its power-hungry data centers.
“We want to have the ability to procure renewable energy to offset power usage of our operations,” said Niki Fenwick, a Google spokeswoman. Ms. Fenwick said that having access to more renewable energy could help the company fulfill its goal to become “carbon neutral.”
This is hardly Google’s first foray into the energy world. Over the years, Google has invested in renewable energy projects through its philanthropic and venture capital units. It has also embarked on a number of engineering projects and partnerships to, for example, advance plug-in hybrids and offer tools to measure home electricity usage. And it has an ambitious goal to help develop renewable energy that is cheaper than coal. Bill Weihl, Google’s green energy czar, discussed many of those initiatives and goals in a lengthy interview with The New York Times published on Thursday.
If Google’s application is granted, the company would be able to sell any surplus power that results from these or other initiatives.

Great News For Your 2009 Tax Bill!

It is looking more and more like the IRS will allow the Residential Energy Credit(form 5695) to be directly refundable for tax year 2009. Why is this important?

In past years the 28% tax credit was held by Uncle Sam against future tax liability. Now we will be able to apply the credits in the same way we apply things like the child tax credit and IRA contributions. The 2009 1040 has been released by the IRS, but the 5695 won't be final until January 14, 2010. Let's keep our collective fingers crossed!