Will Alberta clean energy “firsts” add up to more in 2013? Here’s hoping…

If Alberta was a book, it wouldn’t be fair to judge Canada’s third-largest economy only by its oil-soaked cover.

Sure, the oil and gas sectors are the largest contributors to Alberta’s economy. Yes, documents recently obtained by Greenpeace reveal a far too cosy relationship between the provincial government and industry, if pipeline safety reviews are any indication.

But beyond the ruling Conservative government and the dominance of the petroleum sector are a growing number of progressive Albertan municipalities and entrepreneurs working toward a future not entirely dependent on fossil fuels.

Many achievements, in fact, mark firsts for Canada. The Town of Okotoks, a 15-minute drive from Calgary, was the first community to heat an entire neighbourhood with a solar district heating system. Calgary’s light-rail transit system, the CTrain, is the first to get all of its electricity from wind power.

This year, Edmonton became the first municipality to produce ethanol at a commercial scale from its municipal solid waste.

Meanwhile, a Calgary-based company called Borealis GeoPower aims to generate geothermal power from the hot wastewater that emerges as a byproduct of oil and gas production in the northern Alberta town of Swan Hills – another first, potentially.

One project this writer is eagerly following is developing in Medicine Hat, a municipality often referred to as “Gas City” because of the discovery in 1883 of major natural gas reserves.

Medicine Hat is attempting to prove that, even in a cold northern place like Alberta, energy from the sun can be harnessed directly at existing thermal power plants to displace the use of fossil fuels.

This isn’t a new idea. It’s been talked about since 2007, when the city commissioned a feasibility study to determine if it could be done and made good sense.

Medicine Hat is, in fact, the best place in this massive country to put up solar panels. The city gets more sunlight over a year than any other Canadian city – nearly 50 per cent more sunshine than Toronto.

Would you believe even more than Miami?

Medicine Hat’s plan is to install solar collectors (a type known as parabolic troughs) that can concentrate sunlight so much that the heat produced can turn water into steam. That steam will be fed into the steam generators at the municipality’s existing 203-megawatt thermal power plant, which normally relies on natural gas to produce steam.

Once completed, likely before next fall, it will be the first concentrated solar power (CSP) project built in Canada, as well as the first one ever integrated directly into a natural gas plant.

In October, the city selected Colorado-based SkyFuel to supply eight of its solar collector assemblies for the project, which will be capable of offsetting the equivalent of 1.1 megawatts of electricity normally generated from natural gas.

It’s not much, given the size of the plant, but as a demonstration project it will answer all sorts of questions. Can it scale up? Where else in Alberta would this approach be used? Could it work at coal-fired power plants and in the oil sands to offset natural gas used in bitumen extraction?

How economical is it, both today and as technology improves and costs fall? Who knows, maybe it will prove more cost-effective than carbon capture and storage (CCS) technologies as a way to comply with federal environmental regulations, which will start to kick in come 2015?

One can only hope that the many “firsts” that Alberta is achieving in the area of clean energy will begin to add up and gather collective momentum, and at the same time get the province’s energy-dependent economy on the path to diversification.

Solar. Geothermal. Energy from waste. Wind. All of it will be needed to reduce Alberta’s dependence on fossil fuels, which currently represent more than 90 per cent of its power generation.

The province’s municipalities and entrepreneurs are leading the way, and they deserve the support and encouragement of all Canadians if we are to tackle climate change as a country.

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies.

Provincial first: Ontario’s independent electricity operator embraces new storage methods as effective grid balancer

Calling it an “important milestone” in the evolution of Ontario’s electricity system, Paul Murphy, the president and chief executive of Ontario’s Independent Electricity System Operator, announced Thursday that energy and process storage technologies would be added to the mix of options available to provide regulation services to the province’s grid — that is, keeping supply and demand on the grid in constant balance, second-by-second. To start, the IESO has contracted to add 10 megawatts of regulation services to the mix via a combination of flywheel energy storage, battery storage and “process storage” — the latter being the by-the-second control of many industrial loads as a way to rapidly reduce and ramp up grid demand. It’s sometimes called aggregated demand-response.

It’s a first for Ontario, which until now has relied largely on electricity generation assets, such as natural gas-fired power plants, to provide grid-balancing services. The gradual integration of fast-reacting storage technologies will help reduce our reliance on fossil fuel generation. According to the IESO, “This quick response is becoming increasingly important to facilitate more renewable resources like wind and solar, whose output is variable in nature.”

Through competitive tender, three firms have been contracted to supply this first round of alternative regulation services. Toronto-based Enbala Power Networks will provide 4 megawatts of process storage, which will come from water plants, cold storage facilities, universities, hospitals, and any other industrial, commercial or institutional facilities that have large power loads that can be flexibly used and easily controlled — such as pumps, fans and refrigeration units. For more than a year, Enbala has been supplying its service to PJM Interconnection, which is the regional system operator for 13 U.S. states and one district in the U.S. northeast.

Another 2 megawatts will come through NRStor, which through a partnership with flywheel developer Temporal Power and Ontario Power Generation will integrated flywheel technology into the Ontario grid for the first time. The balance will come from RES Canada, part of renewable energy developer RES Group, which will construct a battery-based storage system in southwestern Ontario (home to many wind farms).

While the numbers are small — 10 megawatts is just a pimple on a elephant’s butt — it finally puts non-hydro storage on the map in Ontario, opening the door for more technologies and approaches, and ultimately many more megawatts and fewer emissions.

“Green” community bonds gather momentum in Ontario

There is plenty of good news happening around community bonds in my home province. SolarShare, for example, announced on Dec. 6 that it had been approved by the Financial Services Commission of Ontario to sell bonds (which offer a 5 per cent annual return) beyond a cap of $1,000. It is now selling up to $25,000, and can go even higher if requests are approved on an individual basis by their board of directors. This has opened up the possibility off pursuing projects more aggressively. The co-op is now going through a process to make its bonds RRSP-eligible. “Once an independent evaluation of SolarShare mortgages that secure your bonds is complete and we have received a legal opinion based on that evaluation, a self-directed RRSP account can be opened through Concentra Credit Union via the Canadian Workers Co-op Federation (CWCF),” the co-op reported in a recent newsletter. “You are also welcome to take that legal opinion to your own wealth management representative and request an account through other channels” —  i.e. you can take it to your own bank and make a case for carrying the bonds in your existing self-directed RRSP.

These bonds are a safe investment, so if you’re tired of getting pummeled by the market and want a safe 5 per cent return, you might want to learn more at www.solarbonds.ca

SolarShare also announced this week that it has partnered with green energy retailer Bullfrog Power, which is helping to finance future co-op solar projects. As an investor, Bullfrog will also market SolarShare’s “solar bonds” to its existing network of green-minded electricity customers. It’s a great partnership.

Meanwhile, ZooShare Biogas Co-operative — of which I am on the board of directors — is making some solid progress with its plans to take animal poo from the Toronto Zoo and turn it into biogas that will be used  for electricity generation. Ontario’s feed-in-tariff (FIT) program finally opened up again just today for small FIT projects, meaning projects like the one ZooShare is pursuing can now apply for a 20-year power purchase agreement with the province. ZooShare has plenty of members now, including the  required number of Toronto property owners, so now we just apply to the FIT program and sit tight for a contract offer. As soon as that comes, it’s full steam ahead…

I’m really hyped about the ZooShare project. If we can show how it’s done, we can replicate the approach in zoos across North America. The pootential is huge, if you’ll excuse the pun. Like SolarShare, community bonds will also be offered for this project, promising a generous 7 per cent annual return based on current calculations. The fact that SolarShare has blazed the trail to get approval from the Financial Services Commission bodes well as we prepare to file our bond offer prospectus. That precedent, as well as the precedent being set for RRSP-eligibility, will also prove beneficial.

For past articles explaining the concept of community bonds and describing the  above projects, click here and here.

Billionaire Peter Thiel, founder of PayPal, funds Ontario man to build prototype for tornado power concept

The Clean Break column below is about an inventor I wrote about in my book Mad Like Tesla. After years of trying to be taken seriously, Louis Michaud, a retired refinery engineer, has finally received some financial backing to build a prototype of his atmospheric vortex engine — i.e. man-made tornado machine — which will create a 40-metre high twister and demonstrate in principle how it would produce electricity from waste heat. The funder in question is a pretty big deal. PayPal founder Peter Thiel, a billionaire also known as being the first outside investor in Facebook, has awarded Michaud $300,000 through his Breakout Labs program, part of the Thiel Foundation. Michaud hopes to have an operational model of his vortex engine done by summer 2013.

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By Tyler Hamilton

Louis Michaud couldn’t ask for a better partner. But he had to turn to California to find him.

The retired refinery engineer from Sarnia, whose grand idea of harnessing energy from man-made tornadoes was first profiled in the Toronto Star back in July 2007, has captured the attention of PayPal founder Peter Thiel, the 45-year-old billionaire who is also known as the first outside investor in Facebook.

Thiel’s philanthropic group, the San Francisco-based Thiel Foundation, announced Thursday that it has awarded Michaud $300,000 to build a prototype of a machine that can create mini tornadoes about 40 metres tall.

The money will come from the foundation’s Breakout Labs program, launched in 2012, which was created to support “audacious scientific exploration” by helping early-stage companies advance their most “radical” ideas.

And, by today’s measure, Michaud’s idea is the definition of radical. Through his company AVEtec — the AVE standing for “atmospheric vortex engine” — the long-term plan is to take waste heat from a thermal power plant or industrial facility and use it to create a controllable twister that can generate electricity.

Here’s how it works: Waste heat is blown at an angle into a large circular structure, creating a flow of spinning hot air. We all know heat travels upward and as it does it spins itself into a rising vortex.

The higher the twister grows, the greater the temperature differential between top and bottom, creating stronger and stronger convective forces that act like fuel for the vortex, eventually allowing it to take on a life of its own.

The result is that hot air initially blown into the bottom of the structure starts getting sucked in so forcefully that it spins electricity-generating turbines installed at the base.

“Using the low-temperature waste heat from a 500 megawatt thermal power plant could generate an additional 200 megawatts of power,” said Michaud. “That would increase capacity by 40 per cent and produce perfectly green electricity at less than three cents per kilowatt hour.”

He should have probably said “could” instead of “would.” There are still many hurdles to jump before getting electricity that cheap. That said, it’s still a nice goal.

Lindy Fishburne, executive director of Breakout Labs, said AVEtec is the first of what’s expected to be more non-U.S. grants awarded through the program, which has so far funded 12 projects — most of them in the category of biotechnology.

One of those companies is called Modern Meadow, a tissue engineering company that has come up with a way to make meat and leather products using 3D bioprinting — no animal killing required. Animal cells are instead replicated in a bioreactor and “bioassembled” using a special three-dimensional printer.

“The range of who we fund is wide,” said Fishburne, adding that AVEtec represents the program’s first clean energy grant, which is aimed at helping Michaud develop a large enough prototype to convince future funders — angel investors and venture capitalists — that it’s worth taking to the next stage of development.

The money, she said, is relatively modest compared to the potential of the technology. “The impact of this project could be so significant that it makes it a compelling space for us to play in,” she said.

The prototype will be built in partnership with Sarnia’s Lambton College, which will host the project. The structure that houses the vortex will be about eight metres in diameter. The twister it produces will only be capable of powering a small turbine, but it’s enough to prove the design works.

“Power output increases geometrically with size, so commercialization will become economically viable when we build a 40-metre diameter structure,” said Michaud. A full-scale facility, one capable of generating 200 megawatts, would need to be 100 meters in diameter and stretch many kilometres high.

Given the destructive history of naturally formed tornadoes, many people might be freaked out by the thought of having man-made tornadoes intentionally scattered near cities and power plants.

Michaud assured that his twisters are much safer to operate and control than, say, a nuclear plant. And because they’re fuelled by the waste heat that’s initially supplied, all the operator has to do is throttle back or cut off that heat to weaken or stop the vortex.

It’s been a long road for Michaud, who began working on the concept as a hobby in the mid-1970s and pursued it full time after retiring from Imperial Oil in 2006.

His work is inspired by French scientist Edgard Nazare, who during the 1940s and 1950s tried unsuccessfully to pursue the idea of a cyclone generator similar in principle to Michaud’s vortex engine.

The scientific community in France wrote off Nazare as a crackpot, but Michaud began corresponding with him in 1973 and the two bounced ideas off each other for several years.

After Nazare’s death in 1998, Michaud felt compelled to carry the torch, starting with the creation of a bench-top prototype he fired up in his own garage and later a four-metre diameter model used for outdoor testing.

The next prototype will be part of a two-year project, with testing to start at Lambton next summer. Of note is that Michaud, having won the support of the Thiel Foundation, could not convince the Ontario Centres of Excellence that his project was worthy of funding.

So much for homegrown support.

Funds from Breakout Labs do come with some strings attached. Thiel’s foundation is entitled to a 3 per cent royalty until AVEtec has paid back three times the amount of the original grant, which works out to $900,000. Breakout also gets a warrant to purchase 1 per cent of AVEtec equity at 1 cent per share.

Sounds like a fair deal for a company that has struggled to be taken seriously. Clearly, Canada needs more Peter Thiels willing to give radical ideas a chance to prove skeptics wrong.

Tyler Hamilton, author of Mad Like Tesla (which features a chapter on Michaud’s vortex engine), writes weekly about green energy and clean technologies.

Should EV charging ports at shopping malls double as premium parking spaces for gas-guzzlers?

Proponents of electric vehicles struggle with the same chicken-and-egg dilemma that has held back many promising technologies over the years.

It’s easy enough selling the virtues of vehicles that plug into a wall socket and run on low-emission electricity. They’re generally clean, quiet, cheap to maintain, inexpensive fuel-wise and quick off the mark when it comes to performance.

But range anxiety continues to be a deal breaker for many. Battery technologies are getting better, charging times are getting faster, but the fact is there aren’t many places to charge an electric vehicle when it’s not parked in your own driveway.

In other words, we need more charging stations — namely, the 240-volt “Level 2” variety, which can cut charging times in half — but there are too few electric vehicles driving the roads to justify the very investment that will boost confidence in and sales of electric vehicles.

This conundrum explains why the Ontario government announced this week the creation of a rebate program for homeowners and businesses looking to purchase Level 2 charging equipment, on top of the $5,000 to $8,500 rebate already offered on electric vehicle purchases.

Starting Jan. 1, a buyer of a charging station can get a rebate of up to 50 per cent of the total purchase and installation cost, capped at $1,000. It could help spur installation of the equipment at gas stations, shopping malls and in company parking lots.

Shopping malls alone are a tremendous opportunity, as most people who go to them stick around for two or three hours — enough time to recharge a good portion of an electric vehicle’s battery system. And landlords of major shopping malls, I’m told, are keen to go “green” while offering an enhanced experience to visitors.

Still, they have a legitimate concern: What if they build it and nobody comes? What if spots dedicated to EV charging are left empty much of the time, while drivers of gas-powered vehicles — the vast majority of shoppers — have to cruise around for an open spot elsewhere?

One innovative answer has been proposed by Toronto-based CleanPark Investments, a minority-owned spin-off of solar project developer Carbonfree Technology. Joel Donen, chief executive of CleanPark, told me that one compromise is to create a premium parking area for EV charging that can also be used for drivers of gas-fuelled cars.

CleanPark’s idea is to build parking canopies near the main entrances of major retail shopping malls, with each canopy housing six parking spaces that would double as solar-assisted charging stations for electric vehicles.

Plug-in vehicles could park and charge there for a modest fee of, say, $2 every hour. Part of this fee would cover the cost of the solar panels and grid-sourced electricity, likely from a green energy retailer like Bullfrog Power, which would supplement the system when the sun isn’t shining.

A bonus is that the spots, based on where they’re located, offer greater convenience for the shopper. The nine kilowatts of solar panels that create the canopy would also keep snow and rain off the cars.

But here’s the kicker: gas-powered cars would also be permitted to use the spots, as long as drivers still paid the per-hour fee. Donen said a part of that fee would go toward either a carbon offset or an environmental charity.

“The challenge is shifting the model away from reserving parking spaces just for EVs,” explained Donen. “By allowing all cars to park in the spaces, we can likely generate sufficient revenue to make the economics work. And an ‘all cars welcome’ policy avoids problems such as empty parking spaces due to a (current) lack of EVs on the road.”

CleanPark is designing this to be economical without relying on incentives such as Ontario’s feed-in-tariff program, which pays a premium to generators of solar power. Revenues would instead come from a portion of the hourly parking fees, third-party advertising on the car ports, and net-metering that would offset the mall’s own electricity use when the sun is shining but no vehicles are plugged in.

With those three sources, “we can likely achieve returns that will satisfy investors without the need for government subsidies,” said Donen. “This would allow us to roll out the program across the country.”

Major shopping mall landlords — those who each have more than 100 malls in their national portfolio — so far appear to be cautiously keen on the idea. CleanPark is eyeing Ontario and B.C. properties initially, but after proving the concept through a few pilot sites, it envisions a network of these car-charging ports emerging across Canada and into the United States.

The mall landlords themselves don’t stand to make much money, if any, by going this route. For them it’s more about better customer experience and service, and that means providing more choice and anticipating the future needs of consumers.

For Donen, it’s about addressing the range anxiety that keeps some car buyers away from plug-in models. “If we’re going to get adoption of more plug-in vehicles, we need that chicken and egg dilemma to start unwinding itself.”

And that’s not going to happen with technological innovation alone. Creative business models, such as this one, are more often needed to turn promising technologies into commercial successes.

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies.