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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

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indiana s clean energy credit program energy efficiency renewable energy set aside

Indiana’s Clean Energy Credit Program(Energy Efficiency & Renewable Energy Set-aside)

Roger Letterman

Sr. Environmental Manager

Office of Air Quality

Compliance Branch

background
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
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
Eligible Projects
  • Demand side management
  • Highly efficient generation
  • Renewable energy projects
    • Wind
    • Solar
    • Biomass
    • Methane capture
demand side management
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
Highly Efficient Generation
  • Combined heat and power at least 60% efficient
  • Microturbines (>500 kW) at least 40% efficient
  • Combined cycle projects > 500 kW at least 50% efficient
  • Fuel cell systems at least 40% efficient
renewable energy
Renewable Energy
  • Wind
  • Solar
  • Biomass combustion
  • Methane capture/combustion
    • Sanitary landfills
    • Water or sewage treatment plant
    • Anaerobic digestion - CAFOs
examples
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 kWh saved during the ozone season
    • Energy savings = 3 NOx allowances
    • 3 allowances x $2,050 x 5 years = $30,750
examples continued
Examples (continued)
  • Landfill Methane Generation
    • Landfill captures/compresses methane that fires reciprocating engines driving four 800 kilowatt generators
    • Generators produce 11,750,400 kWh of electricity for distribution to the grid
    • Electricity generated = 9 NOx allowances
    • 9 allowances x $2,050 x 5 years = $92,250
examples continued10
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 kWh during the ozone season
    • Electricity generated = 17 allowances
    • 17 allowances x $2,050 x 5 years = $174,250
examples continued11
Examples (continued)
  • Combined Heat and Power Project
    • Athletic facility operates two 60 kW 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
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
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
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
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
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