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The Wind Production Tax Credit (PTC) is widely acknowledged as a critical part of American wind power’s development into a mainstream source of electricity and one of the biggest, fastest and cheapest ways to reduce carbon pollution while creating good-paying jobs and saving customers money. So why is there a holdup in its renewal after its expiration last year? 

 
Nationwide, the wind industry employs more than 85,000 American workers and produces enough clean energy to power 15.5 million homes. It saves more than 30 billion gallons of fresh water each year compared with other energy sources and, if growth remains steady, is on track to produce 20 percent of America’s electricity by 2030. 
 
Recently, however, the wind industry has come under strong opposition from groups backed by the billionaire Koch Brothers and other dirty fuels interests. That’s right, the same groups that fight tooth and nail to preserve the $4 billion in annual tax breaks for the oil and gas industry, are systematically derailing the efforts of clean energy and traditional businesses to renew this bipartisan tax incentive in Congress. 
 
Over the past few months, the Sierra Club has released a series of digital and broadcast ads to 
to hold accountable those who stand in the way of wind jobs and to thank those who are actively pushing for PTC’s renewal. Today, we released a brand new patch of digital ads, thanking members of Illinois’ Congressional delegation for their support, including: 
 
  • Mike Quigley (D-IL 5th District)
  • Jan Schakowsky (D-IL 9th District)
  • Brad Schneider (D-IL 10th District)
  • Tammy Duckworth (D-IL 8th District)
  • Cheri Bustos  (D-IL 17th District)
  • Robin Kelly (D-IL 2nd District)
  • Bobby Rush (D-IL 1st District)
  • William Enyart (D-IL 12th District) 
 
These representatives’ continued support of this tax incentive’s renewal is vital for the industry’s long-term growth and the digital ad campaign, which is designed to run throughout the Prairie State during the Congress’ recess, thanks them for their efforts. These new ads thank each of the signers of a letter originating with Rep. Tammy Duckworth, who led several members of the Illinois Congressional Delegation in asking Speaker Boehner to bring legislation that includes the extension of the PTC to the House Floor for a vote. Additionally, Duckworth wrote an op-ed recently in the Daily Herald on the importance of developing renewable energy to strengthen our national security and support our troops. 
 
Wind energy supported 17,400 American manufacturing jobs in 2013 and Illinois is at the heart of wind energy manufacturing and capacity. The goal of these ads is to keep this number moving upward. Help protect wind jobs by calling and emailing your representative to tell them to support the PTC, wind industry jobs and sustainable energy generation. 
 
Note: This blog post is cross-posted with Sierra Club’s Blog

Crowdfunding Solar: Access to Populist Capital

Crowdfunding is populism’s answer to the bank, and it’s being applied to solar. This once novel concept – a collective effort of individuals who network and pool their money, usually via the Internet, to support efforts initiated by other people or organizations – has evolved into a force and molded itself into an exciting company called Solar Mosaic.

Todd Woody’s recent Forbes’ piece, “Solar Crowdfunding Startup Lets Ordinary Investors Own A Piece of the Sun,” reported the two-year-old, Oakland, California-based company already won approval in California and New York to allow individuals to invest directly through its website. This gives ordinary people, with ordinary money, the opportunity to put their personal capital toward solar projects that draw reasonable returns over time. To be fair, they are not exactly investments, but loans that pay their interest through the sale of electricity from solar.

Mosaic’s business model provides die-hard renewable energy advocates, conservationists and corporate responsibility advocates with something that is hard to find elsewhere: a competitive, environmentally conscious investment. Mosaic’s return rates are excellent for those of us schooled in stocks, bonds, REIT and other medium to long-term investment vehicles. You can’t find returns of 4.5% to 6.5% in a CD, online savings account or U.S. savings bond.

With Mosaic, the customer’s money is going directly to the purchase and maintenance of a solar farm that will produce electricity for 20 plus years. There are no price swings, mechanical breakdowns or new hires that will disrupt the farms conversion of light into electricity, and the power purchase agreement with the local utility has its returns locked in from day one. Photovoltaic solar’s greatest virtue from a developer’s standpoint is its simplicity: “Set it and forget it.” This, along with Woody’s research showing that some projects allow investments as low as $25, has the potential of making solar an “everyman” technology.

Why is this important?

If Mosaic is successful at raising enough capital to build solar farms across the United States, and if it proves profitable, then the model can spread and become commonplace over time. As reputations are established and trust is earned through consistently predictable returns, coupled with solid customer service, companies using the model can then be used for many other things – from balancing retirement and education portfolios to alternative investment options for Colleges and Universities seeking to divesting their endowments of companies proliferating climate change.

The recognition of renewable energy as more than a social or environmentalist cause will have a drastic impact on its access to capital and corporate talent. Mosaic’s model is an important step toward the goal of everyone having the opportunity to invest in sustainable energy directly, which encourages an environment of carbon transparency. At some point, perhaps in the near future, it will inspire people to ask their financial advisors, “what gives me the highest return and where does that return come from,” instead of the simplistic, “what gives me the highest return?”

Solar Energy Will Make a Splash in Real Estate

Progress in solar financing is at the heart of the solar industry’s growth. Since the initial passage of the solar investment tax credit (ITC) back in 2005, and its extensions since then, financing has been the greatest boon and greatest hurdle of the industry.

On the one hand, you have companies like Sungevity and Solar City that offer customers a straight forward leasing option that allows them to save substantial sums on the upfront costs of PV systems and only charges them for the electricity they use. All this at a cost that is frequently less than what customers are paying the utility for the same juice. Accounting wizardry in the form of venture funds and bank agreements has makes this model possible and profitable.

On the other hand, you have major commercial projects that fine it difficult to find financial backing from independent investing firms and banks because of a perceived “newness” risk and lack of initial liquidity. The solar leasing companies listed above have first class CFO’s that are able to procure funds from banks by agreeing to higher interest rates and using their ITC credits to sweeten the deal. The old 1603 program helped in the interim when the tax equity market would barely accommodate even that trade off.

Naturally, as the economy improves and companies demonstrate that solar can give investors solid returns with a reasonable degree of certainty, the situation will improve for large-scale developers. But what several companies in San Francisco are doing may bypass that wait with the strategic use of the Real Estate Investment Trust tool.

Bloomberg’s Andrew Herndon wrote an article titled, “Solar Costs to Fall as REIT Emerge as Source of Funding,” which provides a rundown on what the probable future of solar financing entails. For background, REITs are usually formed to develop commercial properties like shopping centers, but Renewable Energy Trust in Capital Inc, lead by Moody’s Investors Service chief executive officer, has asked the IRS to classify solar farms as a type of “real property” so this financial tool can be applied to solar farms.

As Herndon explained in the article, REITs returned an average of 28 percent in 2012 and are popular as tradable stakes in developments that cut the cost of capital for developers. If solar developers where able to use this tool and apply it to promising projects that were unable to find funding, it would be a whole new ballgame. Imagine solar developers having the option to bypass banks and appeal to knowledgeable, upper middle class or wealthy investors?

Historically, REITS have owned and operated income-producing properties that pay investors dividends. They serve as an excellent tool to diversify investment portfolios that are split prudently between stocks and bonds. Herndon wrote that, “The format [of REITs] has evolved to provide funding for other industries including timber, data centers, mobile-phone towers, power lines and natural gas pipelines. The common denominator is that all are tangible assets that generate steady income over a long period of time, and photovoltaic power plants fit that mold.”

Applying REIT’s to the solar industry will help bring more capital into the industry and open up new investment avenues for energy investors interested in substantive investments with great liquidity. Discussion of the capital “bottleneck” that hampers growth in solar industry has been ubiquitous in recent months and this financial tool can be one, among many, that can open more space for capital to flow into the industry. The IRS may issue its first decision on solar REITs this month.

Renewable Energy’s Growth…In the Media

The beginning and end of the year are the best times to work in media because it forces us to look back and summarize what happened. It’s less about chasing stories and more about shaping an honest narrative that readers can identify with and understand. Over the past month, every publication devoted to clean energy has released its top stories and trends for 2012, and have already moved on to making their predictions on what to expect in 2013.

In foraging through my 2012 “best of” lists, one story popped out at me the most: Todd Woody’s “Renewable Energy Winning Mind Share If Not Market Share.” It’s a simple post that covers Factiva’s findings on the mentions of various forms of clean energy in the world’s major print publications in 2002 and then in 2012. As a communications professional, this is important for two reasons. First, it saves me hours of drudgery producing clip compilations and Excel spreadsheets for clients interested in this data for planning purposes. Woody and Factiva just gave it to us for free: thank you.

Secondly, it shows how far we have come. I have been working with renewable energy companies, their trade organizations and environmental advocacy groups exclusively for 4 years. I’ve noted how receptive outlets are to my calls and pitches now versus when I first started in 2008. From CNN, MSNBC and Fox News to Dow Jones, Bloomberg, and Platts, reporters are more familiar with things that I once had to take 10 minute explaining to even get my foot in the door. From my experience, the depth of their questions has improved, suspicion of our releases has lessened, and interest in follow-up stories is more frequent.

What Factiva’s numbers highlight to me is the attitude shift in mainstream media outlets from sometimes skeptical and vague, to more often informed and balanced. There are a variety of reasons for this. The first is the President’s focus on “green collar” jobs and the political fights on Capitol Hill that were created due to his successes, and failures, on the issue. The second is the explosion of clean energy-specific publications, whose quality is close to, or on par with, their fossil energy counterparts. These publications have proven to be both timely and relevant sources of information about the industry, often connecting clean energy growth to the domestic and global economies.

The third reason is the introduction of communications professionals into the clean energy space. Many clean energy companies have realized that just sending out mass press releases is not a communications plan. Reporters, especially those covering broad topics, have little time to sort through the mountain of emails they receive each morning and throughout the day. Tailored approaches to pre-selected, targeted audiences with clear and concise messaging are essential to developing a brand and, most importantly, to cultivating relationships with influential bloggers and reporters at outlets your audience frequents.

High definition photos, videos and interactive websites that tell a story are becoming a necessity instead of a luxury. Old fashioned cold calls and email pitches are still important, but in order to push the envelope in media visibility, communications professionals are supplementing traditional outreach with creative campaigns that cut through the clutter and give reporters and broadcasters something worth covering.

I suspect mainstream media mentions of renewable energy to steadily increase over time, but what I don’t know is what the coverage will look like and for how long. Shaping a clear picture of a company’s purpose, its relationship with its customers, and where it fits into the local and national economy will be the key to PR success in the coming years. The more frequently clean energy companies invest in this, the more fairly and frequently they will be viewed in the media.