Sunday, April 01, 2007

Volume discounts for renewable energy?

A North Carolina nonprofit organization whose mission it is to increase renewable energy may soon offer volume discounts to entice more corporate renewable energy purchasers.

NC GreenPower
is a green energy program launched by the NC Utilities Commission in 2003. Now it wants to offer special rates to industrial customers that buy large amounts of renewable energy. Currently, big customers pay $2.50 per kilowatt hour (kWh) (residential customers pay $4 per kWh). NC GreenPower has asked the state's Utilities Commission for permission to offer companies that spend more than $25,000 a year the option to choose their renewable energy from bids submitted by energy generators at prices below $2.50.
Companies could even select their source of energy like wind, solar, hydropower or hog waste. NC GreenPower would charge a 25 percent commission, added to the price submitted by the generator. From the Business Journal:
Maggy Inman, vice president and program manager for NC GreenPower, says the proposal offers "a more competitive pricing option for renewable energy."

Inman says the idea for discount pricing came from potential industrial customers that currently buy renewable power from other states because it is cheaper. She declined to name any of the potential customers.

"We want to be able to offer something more competitive for some of our resources," says Bob Koger, chief executive of Advanced Energy, another nonprofit that administers the NC GreenPower program.
NC GreenPower serves about 9,700 customers, including residential users and businesses that together purchased 21 million KWh in 2006 - less than 1 percent of the state's total power generation. Currently only 22 companies are spending $3,000 or more on renewable energy annually.

The Utilities Commission considers this proposal as the state legislature debates a renewable energy standard requiring utilities to obtain a certain amount of their electricity from renewables. A ruling is expected by April 15.


Anonymous said...

There's something wrong with the numbers ... $2.50 per kWh ...

I think it is $2.50 per block, which is $2.50 per 100 kWh, which is $0.025 per kWh.

Maria Surma Manka said...

I'm sure you're correct - the Business Journal reported it as $2.50 per kWh but that can't be right. Thanks for your note.