1. Kansas' Future in Renewable Energy Presentation to the Kansas Wind & Renewable Energy Conference September 24, 2008 Mike Eckhart American Council On Renewable Energy (ACORE) www.acore.org

2. Topics ACORE Renewable Energy in America Kansas Renewable Energy –Current status and potential Wind Solar Biomass / biofuels –Jobs in Kansas Case Examples: –Colorado energy plan –Nolan County, Texas: Economic impact Policy Perspective

3. ACORE’s Membership Scope

4. Washington International Renewable Energy Conference (WIREC 2008) 8,600 people from around the world Ministerial + Global Business Conference Nest global meeting in India in 2010 Trade Show to RETECH 2009 Las Vegas

5. Finance Conference Renewable Energy Finance Forum–Wall Street Produced with Euromoney at Waldorf-Astoria Hotel in New York City Next: June 2009

6. Policy Conference “ Phase II of Renewable Energy in America ” Cannon Caucus Room, Washington, DC Next: December 3-4, 2008

7. RETECH ACORE’s All–Renewables Trade Show in Las Vegas February 25-27, 2009

8. Topics ACORE Renewable Energy in America Kansas Renewable Energy –Current status and potential Wind Solar Biomass / biofuels –Jobs in Kansas Case Examples: –Colorado energy plan –Nolan County, Texas: Economic impact Policy Perspective

9. Senate Passed Baucus/Grassley Amendment to HR 6049 Production Tax Credit (PTC) –One-year extension wind PTC –Three-years for biomass, geothermal, hydro, LFG, waste-energy + marine energy Investment Tax Credit (ITC) –Solar: 6-year extension of 30% ITC –Fuel cells: 6-year extension and increase cap to $1,500/kw –New 10% ITC on CHP –Removes limitation on use of ITC by electric utilities Personal / Residential –Efficiency / solar 30% ITC extended 6 years –Increase cap from $2,000 to $4,000 –Offset AMT Clean RE Bonds: $2 billion authorization

10. The Challenge of Putting RE into Use - Regional Resources, Economics, and Politics - Resource Potential SOLAR ENERGY WIND POWER GEOTHERMAL BIOMASS

11. Wind Power Sources: AWEA (actual) and ACORE (forecast) US Wind Power Installations (MW/Year) Key Issues: Production Tax Credit Manufacturing in U.S. Transmission capacity

12. Solar PV U.S. Solar PV Production (MW/Year) Key Issues: Investment Tax Credit Manufacturing in U.S.

13. Concentrating Solar Power 354 MW SEGS 64 MW Solar One 4,000 MW under contract + 40,000 MW Proposed: Key Issues: Cost and Economics Investment Tax Credit Financing

14. Geothermal Energy Geothermal Power: 3,600 MW in operation 3,000 MW coming online 100,000 MW mid-term future Vision: 500,000 MW potential, displacing coal’s baseload role Key Issues: Production Tax Credit R&D and Tech Transfer

15. Hydropower 72,000 MW in place + 3,000 MW incremental hydro + 20,000 MW Small Hydro + 90,000 MW New: Ocean power Kinetic power

16. Biomass Energy Outlook to 2025: Over 100,000 MW of additional potential: Industrial CHP: 57,000 MW Wholesale power: 37,000 MW Solid Waste: 10,000 MW Key Issues: Economics Fuel supply risks

17. Renewable Portfolio Standards DSIRE Database – September 2008 State Goal ☼ PA: 18%** by 2020 ☼ NJ: 22.5% by 2021 CT: 23% by 2020 MA: 15% by 2020 + 1% annual increase (Class I Renewables) WI : requirement varies by utility; 10% by 2015 goal IA: 105 MW MN: 25% by 2025 (Xcel: 30% by 2020) TX: 5,880 MW by 2015 ☼ AZ: 15% by 2025 CA: 20% by 2010 ☼ * NV: 20% by 2015 ME: 30% by 2000 10% by 2017 - new RE State RPS ☼ Minimum solar or customer-sited RE requirement * Increased credit for solar or customer-sited RE **Includes separate tier of non-renewable “alternative” energy resources HI: 20% by 2020 RI: 16% by 2020 ☼ CO: 20% by 2020 (IOUs) *10% by 2020 (co-ops & large munis ) ☼ DC: 11% by 2022 ☼ NY: 24% by 2013 MT: 15% by 2015 IL: 25% by 2025 VT: (1) RE meets any increase in retail sales by 2012; (2) 20% by 2017 Solar water heating eligible *WA: 15% by 2020 ☼ MD: 20% by 2022 ☼ NH: 23.8% in 2025 OR: 25% by 2025 (large utilities ) 5% - 10% by 2025 (smaller utilities) *VA: 12% by 2022 MO: 11% by 2020 ☼ *DE: 20% by 2019 ☼ NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops) ☼ NC: 12.5% by 2021 (IOUs) 10% by 2018 (co-ops & munis) ND: 10% by 2015 SD: 10% by 2015 * UT: 20% by 2025 ☼ OH: 25%** by 2025

18. Renewable Portfolio Standards DSIRE Database – September 2008 State Goal ☼ PA: 18%** by 2020 ☼ NJ: 22.5% by 2021 CT: 23% by 2020 MA: 15% by 2020 + 1% annual increase (Class I Renewables) WI : requirement varies by utility; 10% by 2015 goal IA: 105 MW MN: 25% by 2025 (Xcel: 30% by 2020) TX: 5,880 MW by 2015 ☼ AZ: 15% by 2025 CA: 20% by 2010 ☼ * NV: 20% by 2015 ME: 30% by 2000 10% by 2017 - new RE State RPS ☼ Minimum solar or customer-sited RE requirement * Increased credit for solar or customer-sited RE **Includes separate tier of non-renewable “alternative” energy resources HI: 20% by 2020 RI: 16% by 2020 ☼ CO: 20% by 2020 (IOUs) *10% by 2020 (co-ops & large munis ) ☼ DC: 11% by 2022 ☼ NY: 24% by 2013 MT: 15% by 2015 IL: 25% by 2025 VT: (1) RE meets any increase in retail sales by 2012; (2) 20% by 2017 Solar water heating eligible *WA: 15% by 2020 ☼ MD: 20% by 2022 ☼ NH: 23.8% in 2025 OR: 25% by 2025 (large utilities ) 5% - 10% by 2025 (smaller utilities) *VA: 12% by 2022 MO: 11% by 2020 ☼ *DE: 20% by 2019 ☼ NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops) ☼ NC: 12.5% by 2021 (IOUs) 10% by 2018 (co-ops & munis) ND: 10% by 2015 SD: 10% by 2015 * UT: 20% by 2025 ☼ OH: 25%** by 2025

19. Topics ACORE Renewable Energy in America Kansas Renewable Energy –Current status and potential Wind Solar Biomass / biofuels –Jobs in Kansas Case Examples: –Colorado energy plan –Nolan County, Texas: Economic impact Policy Perspective

20. Kansas Energy Mix and Fuel Prices Coal 73.1% Nuclear 20.5% Kansas relies heavily on coal imported from Wyoming Prices of all types of fuel have increased since 2001 Payments for coal go out of state, even out of country Renewables 2.2% Natural Gas 4%

21. Wind Potential: 3 rd in the US 120,000 MW Total State Peak Load: 10,000 MW 12x

22. New Wind Capacity Per Year 1 project 112.5 MW 2 projects 250 MW 1 project 101 MW 5 projects 549 MW

23. Wind Development Kansas Ranked 12 th in the U.S. Installed Capacity –465 MW –4 projects Under Construction: –548.5 MW –5 projects –1,013 MW end of 2008 Constraints: –Transmission line availability –Uncertain policy Source: AWEA

24. State Wind Development vs. Potential *States in green have RPS

25. Kansas Wind Position *States in green have RPS *TX and CA excluded

26. Kansas Solar Energy Western Kansas: –“Excellent” potential for photovoltaic power –“Particularly good” potential for solar thermal-electric No major projects underway yet Source: DOE

27. Kansas Biofuels and Biomass Biomass Crop and crop residue biomass: 13.9 million dry tons Cellulosic biomass: 8.1 million dry tons Upcoming projects: Biomass cofiring plant under construction in Goodland— owned by Energy Holdings. Biofuels 11 existing ethanol plants Total capacity: 527 mgpy 9 ethanol plants in development Additional capacity: 628.3 mgpy Abengoa Bioenergy constructing $400 million cellulosic ethanol plant in Hugoton—will produce 30 mgpy of second generation ethanol.

28. Topics ACORE Renewable Energy in America Kansas Renewable Energy –Current status and potential Wind Solar Biomass / biofuels –Jobs in Kansas Case Examples: –Colorado energy plan –Nolan County, Texas: Economic impact Policy Perspective

29. Manufacturing Job Loss In oast 6 years, Kansas has lost 10,944 manufacturing jobs –6% of total manufacturing workforce Manufacturing fell from 18% of the total non-farm workforce to 16.6% over that time. Manufacturing is important to Kansas Source: US Department of Labor

30. Renewable Energy is a Growth Industry For every 1000 MW of wind/year, about 3000 manufacturing jobs are created (ref: NREL). Attracting renewable energy companies to Kansas will increase the economic base: –Component manufacturers –Systems engineers and installers –RE equipment manufacturers –Support professionals

31. Wind Component Manufacturing Locations

34. Topics About ACORE Renewable Energy in America Kansas Renewable Energy –Current Status –Potential Wind Solar Biomass / biofuels –Jobs in Kansas Case Examples –Colorado energy plan –Nolan County, Texas: Economic impact Policy Perspective

35. Colorado Resource Plan Generation Additions and Retirements 2007-2015 Wind 800 Central Solar 225 Customer Solar 29 Biomass4 DSM 360 Gas Generation 980 Additions 2,398 Additions 2,398 Retirements -340 Net Additions 2,054 Net Additions 2,054 MW WindSolarDSM Energy Sources 1,084 MW 1,884 MW 17 MW 271 MW 147 GWh 1,618 GWh 20072015 Source: Colorado Public Service Co.

36. Economic Case Study: Nolan County, Texas Current Wind Capacity: 2,500 MW Future: add 3,000 MW by 2009 More wind capacity than California 1,124 direct jobs in Nolan County –20% of the county’s workforce. –Permanent O&M jobs make up 29% of direct jobs 2008 economic impact in Nolan County: $315 million/year Source: “Nolan County: Case Study of Wind Energy Economic Impacts in Texas.” Prepared by New Amsterdam Wind Source LLC.

37. Nolan County, Texas Since the Wind Boom Began: Real Wages are UP by 9%Unemployment is DOWN 6.1% - 4.8% since 2003

38. Property Taxes Nolan County has expanded services, while lowering residential tax rates. Lower tax rates mean more disposable income for residents. Tax base has increased 5x since 1999 Projected to continue growing to 7x.

39. Land-Lease Payments to Nolan County Farmers YearWind CapacityPayments to Farmers 20082500 MW$12.6 million/yr +20093600 MW$17.7 million/yr By end of 20096100 MW$30.3 million/yr T. Boone Pickens

40. Topics About ACORE Renewable Energy in America Kansas Renewable Energy –Current Status –Potential Wind Solar Biomass / biofuels –Jobs in Kansas Case Examples –Colorado energy plan –Nolan County, Texas: Economic impact State Policy Perspective

41. Additional Policy Benefits of Renewable Energy Energy Supply –Coal Money goes out of Kansas to Omaha and London –Wind, Solar and Biomass can be Kansas-growth energy sources State response to Climate Change –Regional and state-level innovation today –Preparing for longer-term reduction of GHG emissions Environment: –Reduced emissions of all pollutants associated with power generation –Reduced water consumption Health Benefits –Lower smog, soot, acid rain, and toxic air emissions. –Lower rates of asthma, respiratory illness in children, cardiovascular failure, and chronic bronchitis (ref: EPA)

42. Policies to Promote Renewables Current Kansas renewable energy policies: –Property Tax Exemption –Solar Easements –Interest-free loans and utility rebates Future legislation under consideration: –Renewable Portfolio Standard –Financial incentives –Transmission line development ACORE recommends: –Economic development incentives –Continuing to protect the environment and important view shed

43. Closing Thoughts Kansas has excellent renewable energy resources: –#3 state in wind potential: 12x state peak load –Very good opportunities on solar energy –Substantial opportunities in biomass power Kansas can begin to receive economic benefits: –Investment in new manufacturing facilities –Construction, operations and maintenance jobs –Increased land lease payments to Kansas farmers –Increased property taxes to local governments –Higher average wages and disposable income –Lower unemployment. ACORE urges Kansas to continue its commitment to renewable energy, and we stand ready to help.

44. Kansas' Future in Renewable Energy Thank You Mike Eckhart ACORE meckhart@acore.org

45. Reference Slides

46. Technology Comparison CoalWindSolar Existing5500 MW465 MW - Construction -549 MW - Proposed1400 MW ? ? Price/kWh2-5 cents 10-20 cents Capacity Factor 70-90%30-40%15-25% Total State Load: 10,000 MW Demand growing at 1.5% per year

47. Existing Wind Projects Elk River Wind Farm Gray County Wind Farm Spearville Wind Energy Facility Smoky Hills Wind Farm Capacity150 MW112.5 MW100.5 MW101 MW # of Turbines1001706756 Project Location Butler CountyGray CountyFord CountyLincoln County Total Acres20,00012,0005,00012,000 % of Land Affected 2%.05%1.3%1-2% UtilityEmpire District Electric (MO) AquilaKCP&LKansas City Board of Public Utilities OwnerPPM EnergyFPL EnergyenXcoTradeWind Energy Turbine Supplier GE EnergyVestasGE EnergyVestas

48. Price of Wind Wind and Wholesale Power Prices by Region: 1998-2007 Projects

49. Price of Wind Power Competitive at a National Scale 2003 to 2007 Average Cumulative Price of Wind and Wholesale Power Prices over Time This is Illustrative Must model this on a Portfolio-specific basis

50. Kansas Renewable Resources: Biomass