1. Renewable Energy Project Economics, Policy and Incentives NARUC Staff Subcommittee on Accounting and Finance October 8, 2007 Dr. Lola Infante Manager, Generation Fuels and Market Analysis

2. Renewable energy: Economics, barriers and incentives Market penetration Renewables’ share in power generation remains modest Growth driven by wind Drivers Renewable energy standards Financial incentives Cost remains a main barrier for renewable deployment Capital cost Transmission and integration Intermittency requires additional reserves Growth will depend on policy and technology developments

3. Energy Sources and Uses Sources: U.S. Department of Energy, Energy Information Administration, 2004 data.

4. Renewable Energy Net Generation - 2006 * Includes wind, solar, biomass and other non-hydropower renewable energy sources. ** Includes generation by batteries, chemicals, pitch, and purchased steam. Source: U.S. Department of Energy, Energy Information Administration, 2006 data

5. Growth of renewables Source: U.S. Department of Energy, Energy Information Administration, 2006 data

6. Growth of Wind million MWh Sources: EIA Electric Power Monthly and EIA Electric Power Annual.

7. Renewable generation in the states generation mix Data: U.S. Department of Energy, Energy Information Administration, 2006 data Only shown the states with total renewable generation >1%

8. Where renewable generation is Data: U.S. Department of Energy, Energy Information Administration, 2006 data Only shown the states with total renewable generation >1% of US total Wind

9. Drivers Renewable Energy Standards in the states (26 + DC) create a “regulatory” demand for renewables The PTC and other financial incentives facilitate the financing of new capacity and lower its cost

10. 26 States & The District of Columbia Have Renewable Energy Standards

11. Resources: Wind Power Source: NREL, Wind Energy Resource Atlas of the United States

12. Resources: Solar Radiation – Tracking Concentrator Source: NREL

13. Resources: Biomass Source: NREL

14. Resources: Geothermal Source: NREL, Geothermal Resources Estimates for the US, Technical Report, NREL/TP-840-40665, Nov. 2006

15. Costs are increasing: Wind Power Prices

16. Costs are increasing: Project costs increases are a function of turbine prices

17. Transmission Access for Renewable Energy Source: Global Energy Decisions, Inc., The Velocity Suite

18. Future Contribution of Renewables to the National Fuel Mix 2006 2030 Source: U.S. Department of Energy, Energy Information Administration, 2006 data Source: U.S. Department of Energy, Energy Information Administration, Annual Energy Outlook 2007 Early Release BAU - generation

19. Future Contribution of Renewables to the National Fuel Mix

20. Thank you! Contact information: Lola Infante linfante@eei.org (202)508-5133