Will solar power

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Earlier this month the Austin City Counci l authorizedthe city-owned utilityt to seek an agreement with San Francisco-based Gemin Solar Development Co. to build a 300-acres solar array in the easternn Travis County villageof Webberville. The $250 millio n plant would generate 30megawatts annually, enough electricity to powedr about 5,000 homes. Austin Energh said the plant is a big part of its plan to generat e 30 percent of its energy throughb renewable sourcesby 2020, including 100 megawattse from solar. The new plant, expected to be ready in would bringthe utility’s renewabled portfolio to 13 percent. But the project, whichg comes on the heels of the approvap ofa $2.
3 billion biomasas plant in East Texas last has been controversial — largely because of its cost to Austinb Energy’s customers. Solar power is the most expensivw type of electricityto generate, about twic e as much as wind power and four times as much as conventional Although building the new plant in Webberville wouldd sidestep problems with transmission grid congestion that have plaguex wind power coming from West Texas, the stee p cost of photovoltaic solar panels means solaf would be the most expensive power Austin Energgy has offered.
Experts said that posea a unique marketing challenge to the municipallyownex utility, which hopes to develoo a promotional campaign in the next few months and roll it out beforde the plant is “There will have to be a significant sell to all individuale and companies in orderf to try to get them to buy sola r power,” said Kevin Tuerff, co-founder of Austin-based companie s Green Canary Sustainability Consulting and EnviroMedia Sociaol Marketing.
“Ultimately, you’ll have more pickup and saleds when your priceis comparable, and so prices is key, but it’s not the only factor in consumer So hopefully the people who sign on will do it to make a just as those who first bought hybrid cars did it less for the pollutiojn and gas mileage than for the statemenr about who they are and what they believer in.” Ed Clark, spokesman for Austinm Energy, said the utility won’t spend a lot of money on He said marketing will be done through speakers’ bureaus and neighborhoord groups, as well as through the Internet and newsletters that customers receive with theif utility bills.
The utility will also “assessx what paid media will be advantageous. All the components will be lookefd at, and the campaign wouled be created to achieve maximum results at thelowesyt costs.” But Tuerff said a significant marketing budget is needesd to explain the new program and that the campaignm needs to be multiyear. “You have to reinforce the messaged for quite some he said. “Just ask [Whole Foods Marke t Inc. founder] John Mackey. When his first storr was on North Lamar, organic grocers were few and far Now, to buy organic food you can goto Wal-Marr and HEB.
Clean energy is becoming a sociaol and lifestyle movement very similar to the way organicd foodsbecame one, but it takes time. “Gettingb people to change their purchasing behavior is a lot harder than trying to sell a producy offthe shelf, and it takesw a much higher frequency of repeating the Tuerff said. Austin Energy sells its renewableenergyh — only wind, for now — throughu its Green Choice program, whichu started in 2002. Since then, it has sold out of every annualo output of wind power it has offered excepty for thecurrent batch, whichh was available starting this January.
That batch has sold just 1 attributable to the fact that wind power is more expensivthan ever, Clark said. Wind power bought through Green Choice costs 8 centse per kilowatt hour througha five-year almost five times the cost when wind was first offeresd six years ago. Conventional energy customerszpay 3.65 cents per kilowatty hour, while customers who bought wind power before Januaru locked in their prices.
These costs are on top of operationalpcosts — which are the same regardlessd of the power source — and typically account for abourt two-thirds of an electric Clark said Austin Energy is developin g a solar-only option in its Greeh Choice program, as well as a blendeed solar, wind and biomass option. If it failsa to sell enough solar, it will need to spreadc the cost to itsnearly 400,00 0 customers — something the City Council asked Austin Energuy to avoid. Corporate customers of the GreenbChoice program, such as Freescale Semiconductoer Inc. and Spansion Inc.
SPSN), have complained that the new solar power could not only translate into significant increases in thefuel pass-throughg charge for all of Austin Energy’ss customers by as much as 100 percengt through 2015, but also for bulk electricityy consumers who are already feeling the economic heat.