Indianas Clean Energy Credit Program Energy Efficiency Renewable
Indiana’s Clean Energy Credit Program (Energy Efficiency & Renewable Energy Set-aside) Roger Letterman Sr. Environmental Manager Office of Air Quality Compliance Branch
Background • Clean Energy Credit Program (CECP) is implemented through the Energy Efficiency/Renewable Energy Set-aside • EE/RE Set-aside established in Indiana’s NOx Budget Trading Program • EE/RE Set-aside is “pool” of NOx allowances for EE/RE projects • One NOx allowance = one ton of NOx emissions
NOx Budget Trading Program • Regional trading program involving 21 states in eastern U. S. • Sources in the trading program must hold NOx allowances equal to ozone season (May 1 - September 30) NOx emissions • NOx allowance value fluctuates - currently between $1, 800 and $2, 300 per allowance
Eligible Projects • Demand side management • Highly efficient generation • Renewable energy projects – Wind – Solar – Biomass – Methane capture
Demand Side Management • Lighting efficiency/control projects • Building retrofits (insulation improvements, window replacements) • Process equipment efficiency improvements • Heating and cooling efficiency improvements • Reducing fuel usage
Highly Efficient Generation • Combined heat and power at least 60% efficient • Microturbines (>500 k. W) at least 40% efficient • Combined cycle projects > 500 k. W at least 50% efficient • Fuel cell systems at least 40% efficient
Renewable Energy • • Wind Solar Biomass combustion Methane capture/combustion – Sanitary landfills – Water or sewage treatment plant – Anaerobic digestion - CAFOs
Examples • Commercial Building Envelope Retrofit – Retailer completes variety of energy efficient retrofits including: • Compact fluorescent lighting, energy management systems, energy efficient HVAC/windows and LCD exit signs – 4 million k. Wh saved during the ozone season – Energy savings = 3 NOx allowances – 3 allowances x $2, 050 x 5 years = $30, 750
Examples (continued) • Landfill Methane Generation – Landfill captures/compresses methane that fires reciprocating engines driving four 800 kilowatt generators – Generators produce 11, 750, 400 k. Wh of electricity for distribution to the grid – Electricity generated = 9 NOx allowances – 9 allowances x $2, 050 x 5 years = $92, 250
Examples (continued) • Wind Turbine Project – Wind development company installs ten turbines with maximum output of 1. 5 MW – Turbines generate 40% of maximum capacity and 22, 032, 000 k. Wh during the ozone season – Electricity generated = 17 allowances – 17 allowances x $2, 050 x 5 years = $174, 250
Examples (continued) • Combined Heat and Power Project – Athletic facility operates two 60 k. W microturbines with waste heat used for hot water production and heating two swimming pools – Electricity generated and heat used = 1 NOx allowance – 1 allowance x $2, 050 x 5 years = $10, 250
Applicant Requirements • Project sponsor must contact U. S. EPA to establish a general account for holding NOx allowances • Projects must result in a least one ton of NOx reductions/savings • Projects may be combined to meet the one ton requirement
Application Process • Submit application by September 1 of year prior to anticipated implementation • IDEM/OEDD review applications and requests additional information where needed • After approval, allowances are reserved for following ozone season
Allocation Process • Results submitted each year after implementation • IDEM/OEDD review results to verify NOx savings • Appropriate NOx allowances are calculated • IDEM notifies U. S. EPA to transfer the NOx allowances from EE/RE set-aside
Program Benefits • Energy savings - reduced fuel usage, reduction in electricity demand • Air quality - reduced pollution from electric generators, incentive for “clean” energy • $$ - provides economic incentive • Innovation - provides incentives for newer, cleaner energy and energy efficiency
Additional Information • www. IN. gov/idem/energycredit – Guidance manual – Application materials – Links for measurement and verification protocol guidance • Contacts – Roger Letterman 317/232 -8342 – Ryan Brown 317/232 -8961
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