Forget the handicap
Renewable energy - stand on your own legs or leave center stage. Natural gas, the limelight is all on you.
That's the perspective of several panelists who will speak at the Association of Corporate Growth's DealMaker's Forum on Oct. 6 as well as one of the event's sponsors.
"I see limited growth from the renewable side," says Steven B. Richardson, a partner in the energy group at the Denver law firm of Holme Roberts & Owen.
"It's not like oil and gas, where if you produce it, you can sell it," he explained. Renewables need long-term contracts - and the key to getting them is having long-distance transmission. And transmission, he added, remains expensive and getting permits is still very, very difficult.
Richardson has been doing energy work for 30 years, both in conventional fossil fuels and in the array of renewables: solar, wind, biomass and others. The new shale gas discoveries, including those in Colorado, clearly represent a significant shift in opportunities. Unlike electrical transmission, natural gas can be shipped readily through existing pipelines to power plants near demand centers, such as cities, and used for any number of purposes: base-load generation, peak needs, or as backup to wind.
Wind energy and natural gas are competing at the margins, he noted, but the great versatility of natural gas makes it attractive.
Much depends upon mandates and subsidies. In Colorado, Xcel is rapidly closing in on its renewable portfolio standard of 30 percent. In Washington, with the focus on U.S. debt, subsidies of all types will get greater scrutiny.
John Spisak has a business based on solar, but he is adamant that renewable energy must stand on its own. "If Colorado is to build a future around alternative energy, it had better be sure it's stable," he says. "Subsidies, at the end of the day, are political."
Spisak's career has been in natural resources for 40 years. In 2008, he founded SolaRover. Based in Lone Tree, it offers the use of portable solar panels to generate electricity such as might be used in responding to a hurricane cleanup. Diesel-powered portable electrical generators run more than $1 per kilowatt hour at a minimum.
"SolaRover can deliver electricity for 40 to 50 cents per hour. That's more than the grid, but we are not competing with the grid," he points out. His is for portable applications.
The greatest opportunities, says Spisak, lie in creating buildings that need less heating and cooling and use electricity more efficiently. The challenge is getting financiers to recognize the long-term cost savings from lower energy bills that result from tighter, smarter, more energy-efficient construction techniques. Such techniques and materials cost more, but the payback is rapid.