The Renewable Energy Fund (REF), managed and administered within the Rhode Island Economic Development Corporation (RIEDC), has historically been the state's sole, dedicated source for renewable energy funding. The program provides grants, recoverable grants and loans for commercial, municipal and housing projects, as well as feasibility studies.
Alternative Energy in Rhode Island
Keith W. Stokes | Rhode Island Economic Development Corporation
1) What new investments has Rhode Island seen from alternative energy companies in the last few years? What are some of the reasons alternative energy companies are choosing to locate in Rhode Island?
In 2011, with leadership from Governor Lincoln D. Chafee in collaboration with the Rhode Island General Assembly, the state enacted substantive renewable energy legislation. This comprehensive legislative package extended the state’s Renewable Energy Fund, established the Renewable Energy Coordinating Board, ensures that interconnection standards and timeframes be expedited, clarifies the state’s already robust net metering laws and created the Distributed Generation Contracts (DGC) incentive program to promote further clean energy development in Rhode Island.
The DGC legislation has prompted increased interest in growing alternative energy in Rhode Island and has generated significant interest from local, regional and national developers. Some of these developers have already established a local presence solely so they can participate in the program.
The DGC program will support the development of 40MWof renewable energy projects in the next several years through long-term contracts, with fixed-price and credit-worthy off-take that will accelerate project financing. This represents opportunities for about $150-$200 million in total renewable energy development in our state. The program establishes a variety of renewable energy technologies and capacities for each class, including price per kWh values as prescribed. This price will be the price that our state’s primary utility, National Grid, will enter into in 15-year, fixed and standard contracts.
2) Tell me more about the Rhode Island Renewable Energy Fund, and the specific projects it has funded. How can companies apply for funding?
The Renewable Energy Fund (REF), managed and administered within the Rhode Island Economic Development Corporation (RIEDC), has historically been the state’s sole, dedicated source for renewable energy funding. The program provides grants, recoverable grants and loans for commercial, municipal and housing projects, as well as feasibility studies. The REF seeks to diversify its funding across traditional, direct installation projects and more market development and business development activities.
The REF has invested in many projects in Rhode Island in an effort to reduce energy costs, help businesses reduce operating expenses and stimulate business attraction to the state. To assist United Natural Foods in their relocation to Rhode Island, the REF invested in a long-term incentive payment structure for the installation of a solar PV system. Their relocation netted the state 150 jobs at the onset, which is projected to grow to upwards of 240 employees over three years. Additionally, the REF has invested in the East Bay Energy Consortium, which features nine municipalities forming a coalition to develop a 20 +/- mW wind farm in an industrial park and provide an alternative power source to local businesses and residents.
The REF provides support to local businesses looking to decrease their operating costs and make them more competitive. A direct investment was made in Arpin Van Lines so they could install a 175 kW solar PV, which was part of an overall $2 million renovation and construction of their LEED Certified corporate headquarters in West Warwick, RI. This solar system not only helps to achieve Arpin’s green objectives, but will save the company over $21,000 per year in utility costs.
Those interested in REF funding can find an application on the RIEDC website at: http://www.riedc.com/business-services/renewable-energy
3) How did the Deepwater Energy Center come about, and what will it mean for the future of offshore wind farming?
In 2004, Rhode Island established its Renewable Energy Portfolio standard, which mandated that 16% of the state’s electricity come from renewable resources by 2019. To achieve this goal, the state underwent a comprehensive study to evaluate its natural resources for renewable energy development and identified “offshore wind” as a prime opportunity. In the subsequent evaluations and discussions, the state took an initial step to seek a private developer and potentially generate 1.3 million MWh of energy per year through offshore wind – approximately 20 percent of the state’s power. Following a competitive review and evaluation process, it was determined that Deepwater Wind would become the preferred development partner.
Since that time, Deepwater Wind has taken the lead in developing this project. Their partnership with the state has included: a) a first-of-its-kind in the nation ocean mapping project (Ocean Special Area Management Plan - “SAMP”) to identify the best sites off the coast of Rhode Island for offshore wind energy development; b) locating and leasing land near one of the state’s key ports and multimodal commercial transportation hubs at the Quonset Industrial Park; c) working with the General Assembly to pass long-term renewable energy contracting legislation; and d) securing Public Utilities Commission approval of a long-term power purchase agreement between Deepwater Wind and the state’s largest utility, National Grid.
There is potential for this project to be the first offshore wind farm in the United States. In addition to modeling a development process, being first in the water would give us the opportunity to develop infrastructure and a workforce specialization around this type of industry that could be leveraged regionally.
4) Do you expect more wind companies to come to Rhode Island because of the Deepwater Energy Center? How will it benefit people that live in Rhode Island?
There is great potential for business growth in the energy sector. If Rhode Island is home to the first offshore wind farm, we expect and would encourage more companies to relocate to Rhode Island. What we believe would be the strongest attraction in the short term, is in companies that are in the business of manufacturing, construction, assembly and logistics of large-scale wind turbines. We have significant assets – both capital and workforce – located within our industrial park and port at Quonset, and we intend to leverage these assets to attract industries that support offshore wind throughout the industry supply chain.
5) What about solar --- are there any significant projects underway now or in the near future?
Rhode Island is a small and compact state, so we are seeking to develop appropriate projects of scale. The state recently invested in Toray Plastics, the state’s largest employer and energy consumer, to complete a 375 kW on-site, ground mounted solar PV system. Additionally, the REF has provided the City of East Providence, which has partnered with a private developer, with a grant to turn their former landfill into a 5 – 10 MW solar farm. With the advent of the DGC program, REF has been reviewing several other proposals – mostly solar -on large municipal tracts such as closed landfills - and believes there are three to five more solar projects in the 5+ MW range that could realistically be developed in the short term.
6) Any other significant projects or programs that you would like to talk about?
Building on the success of the Ocean SAMP, Rhode Island has implemented a similar state land-based program (Renewable Energy Siting Partnership - “RESP”) to identify the “best” public and/or private sites in the to pursue appropriate land-based renewable energy development opportunities.
Additionally, this past summer, Governor Lincoln Chafee announced that a total of $6.5 million in federal American Recovery and Reinvestment Act (ARRA) funds will be used to further the state’s leadership in advancing renewable energy development and to support energy efficiency programs to help businesses operate more cost effectively. As part of an ongoing collaborative effort, the state’s Office of Energy Resources (OER) and the RIEDC have partnered to create the Business Energy Assistance Program (BEAP). This program provides both direct investments to spur “shovel-ready” projects and establishes a long-range, self-sustaining renewable energy financing mechanism.
The BEAP has already been provided direct financing support to 16 renewable energy projects. Additional funds will primarily be used to establish a capital reserve fund that can be leveraged multiple times to direct a long-term, predictable and sustainable flow of investments into the state’s clean energy economy.
7) What can other states learn from your experiences in Rhode Island?
As part of a focused economic development agenda, Governor Lincoln Chafee and the RIEDC Board of Directors have made growing key industries, including renewable energy, one of their top business and job growth priority areas. Rhode Island has embraced the clean energy economy as part of its overall economic development goals. Through acceleration of renewable energy sources and investments in manufacturing, innovation and new venture creation, Rhode Island will drive economic, environmental and employment growth. Energy – and the policies that promote secure, competitive, diverse and reasonably priced energy – will help retain, expand and attract businesses in Rhode Island. This focus on the part of state leadership is what allows our renewable energy programs to leverage a significant amount of private follow-on funding and stretch our resources further.
The DGC program provides the state added value by creating a dedicated project funding incentive framework in addition to the REF. This frees up capital that would have otherwise been invested in project grants and allows those funds to spur new investments in R&D, commercialization opportunities, business startups and other activities that are part of our economic development priorities. With the DGC program in place, we plan on seeing significant growth on the project and innovation sides of clean energy in 2012.
It is also this approach that has really been helpful in developing new policy and programs. As I discussed, the DGC program, which passed this year, passed in large part because of the recognized role alternative energy plays in economic development. The state last year assembled a Small Business and Renewable Energy Task Force to look at these very issues. The task force comprised of state agencies and many local business leaders, was the body that helped outline the parameters for what became the renewable energy legislation. It was because the business community was involved in the development of these policies that we were able to so quickly adopt and implement legislation.
To put it in context – the DGC program was introduced and passed in its first year. Passage came on June 28, 2011, and the program will enter into its first contracts by December 31. The efficiency with which this program has become a reality is representative of how engaging government leaders, the environmental and business communities in an open and transparent process that ultimately benefits all stakeholders can greatly accelerate renewable energy development policies.
8) What are your goals for Rhode Island’s alternative energy industry moving forward?
Moving forward, we want to continue investing in projects and initiatives that support the sustainable growth of our overall economy. We have made great strides in providing direct support to key alternative energy-producing projects and companies making advances in renewable energy technologies. The DGC program is poised to create a $200 million development market in Rhode Island over the next three to four years, and we stand ready to use available federal funds to establish and strengthen capital programs to support this growth opportunity.
Rhode Island is also home to several world-class R&D institutions including the University of Rhode Island, Brown University and the Rhode Island Schools of Design which are already involved in the alternative energy arena and are supplying the state with a trained talent base to help the state lead the nation in this industry. There is a great opportunity in partnering with these institutions to really spur the creation of innovation-to-market concepts within this space.
The RIEDC understands the inextricable link between energy costs and economic development and has taken a lead in ensuring the state’s clean energy policy, incentives and programs are aligned with our overall mission: “Job creation, job retention, job attraction”. Within the clean energy economy, Rhode Island is creating jobs and business by directly investing in commercial renewable energy systems, attracting business, including clean energy business, to the state, supporting innovation and new venture creation, and working within a regional context to procure lower cost energy, and establish a greater clean energy network. Through these activities, Rhode Island will continue its leadership position in the clean energy economy.
By expanding our scope and investing more in a clean energy, we will not only see stabilization of energy prices which will make Rhode Island even more business friendly and competitive, but we will see the birth of new companies, the development of new products, processes and technologies in this dynamic industry and the creation of quality jobs and long-term prosperity for the state and its business community.
Newport Biodiesel Production Facility - shows the Waste Vegetable Oil (WVO) settling tank on the left. As the Waste Vegetable Oil is delivered to the facility, it is heated and left for 24 hours so that food particles can settle out before the processing begins. Once this has occurred, the WVO is pumped to the Biodiesel Processor which is the large, tall tank on the right. That is a 2200 gallon tank that has a large stirring system inside it. The WVO and methanol are mixed in that tank for about three hours and the result is biodiesel and glycerin. The tank in the far back is used to separate the glycerin from the biodiesel, again by settling. The four small tanks in the middle are "finishing" tanks which remove any excess methanol left after the processing is completed. These tanks insure that the biodiesel produced meets ASTM specifications. It takes us about three days for the WVO to be introduced to the plant and come out as biodiesel.
The content & opinions in this article are the author’s and do not necessarily represent the views of AltEnergyMag
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