WILLMAR -- With the stated goal of using biofuels as an engine to move the region to a positive economic future, community leaders heard Wednesday about tools to make that happen.
Bill Glahn, director of the Minnesota Office of Energy Security, discussed during a forum in Willmar the existing programs and potential programs that could help residents, businesses and local governments and utilities obtain the necessary capital to implement clean-energy projects.
The current economy has made it more challenging to get capital to feed into the "next generation of biofuels," Glahn said. But that doesn't mean there aren't funding options available, whether it's for a large-scale wind farm or solar panels on a residential roof.
The Office of Energy Security, which is part of the state's Department of Commerce, is a "one-stop shop" for information about how to fund, plan and implement renewable energy and conservation projects, Glahn said. "You should consider us a resource," he said.
The country's use of coal-based energy that sparked the Industrial Revolution helped carry the economy to the present time, Glahn said, and a grassroots, "bottom-up effort" could be a "powerful aspect for change" for a renewable energy system to carry the economy and the country forward to a new phase.
Last year the Legislature approved a funding mechanism called PACE, or Property Assessed Clean Energy, that's being used in other states to allow commercial and residential property owners to use county bonds to pay for renewable energy.
The voluntary program would allow local units of government to obtain a bond that would be used by the private sector to fund clean energy projects, whether it's a large-scale wind farm or a solar heating project. The participants would pay back the loan through individual property taxes. Only the people using the bond and building the projects would be assessed the extra tax. The costs would not be borne by other taxpayers.
The plan could work only if there are enough participants that would allow the government entity to see a large enough bond to attract investors. There have been questions about high interest rates attached to these types of bonds and concerns expressed by other lenders.
Glahn said there are some glitches to the state's plan that are expected to be cleaned up in 2011 before it could be implemented here. "It's a work in progress."
Some countries, such as England, are also implementing a "pay as you save" program where utility companies construct their own clean-energy projects that are paid for through customer utility bills. Because the utility saves money by not having to purchase as much electricity, the customer ultimately saves money on electric bills.
Glahn also said a contest called "Minnesota Cup" rewards entrepreneurs who have a plan for clean technology and renewable energy with award money and access to venture capitalists. The 2010 winners will be announced in September.
The federal stimulus money brought $200 million into the state that was used to subsidize expansions at energy-related businesses and make energy-efficiency improvements to homes of low-income residents. Glahn said most of that money is now gone and is not a likely source for new projects.
A new solar rebate program for solar thermal projects for homeowners is available. His advice for seeking that rebate is "act fast."
When it comes to asking government for funding, Glahn said the state is broke. "There's no money out there." But his office, and the department's website, can provide links to grants that fund renewable energy projects. Applications can be made directly to the federal government for funding from those programs, he said.
Getting money to finance renewable energy isn't the only obstacle. Even though Minnesota has enough potential wind capacity to generate 75,000 megawatts of electricity -- one megawatt can power 800 to 1,000 homes -- Glahn said there are not adequate transmission lines to carry the power. "Nobody wants them in their backyard or running through their farm," Glahn said.
An ethanol pipeline that would take the biofuel from the Midwest to the East Coast would be a "game changer," said Glahn.
Regarding renewed interest in building new nuclear power plants in the U.S., Glahn said even if a plant was approved today, it would take at least 15 years for the permitting process to be completed. Given that timeframe, Glahn said decreasing energy usage through conservation and increasing the output of renewable energy would be needed for the interim.
Steve Renquist, director of the Kandiyohi County and City of Willmar Economic Development Commission, said it's necessary to remove obstacles and create a favorable environment for financing and constructing renewable energy projects. "Shame on us" he said, if an opportunity is lost because of inaction.