Green Energy Options for Consumer-Owned Business DE-AC36-99-GO10337
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A national laboratory of the U.S. Department of Energy Office of Energy Efficiency & Renewable Energy National Renewable Energy Laboratory Innovation for Our Energy Future Green Energy Options for Subcontract Report NREL/SR-560-39465 Consumer-Owned Business May 2006 Co-opPlus of Western Massachusetts Greenfield, Massachusetts NREL is operated by Midwest Research Institute ● Battelle Contract No. DE-AC36-99-GO10337 Green Energy Options for Subcontract Report NREL/SR-560-39465 Consumer-Owned Business May 2006 Co-opPlus of Western Massachusetts Greenfield, Massachusetts NREL Technical Monitor: Holly Thomas Prepared under Subcontract No. ZAT-4-33658-01 National Renewable Energy Laboratory 1617 Cole Boulevard, Golden, Colorado 80401-3393 303-275-3000 • www.nrel.gov Operated for the U.S. Department of Energy Office of Energy Efficiency and Renewable Energy by Midwest Research Institute • Battelle Contract No. DE-AC36-99-GO10337 NOTICE This report was prepared as an account of work sponsored by an agency of the United States government. Neither the United States government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States government or any agency thereof. Available electronically at http://www.osti.gov/bridge Available for a processing fee to U.S. Department of Energy and its contractors, in paper, from: U.S. Department of Energy Office of Scientific and Technical Information P.O. Box 62 Oak Ridge, TN 37831-0062 phone: 865.576.8401 fax: 865.576.5728 email: mailto:[email protected] Available for sale to the public, in paper, from: U.S. Department of Commerce National Technical Information Service 5285 Port Royal Road Springfield, VA 22161 phone: 800.553.6847 fax: 703.605.6900 email: [email protected] online ordering: http://www.ntis.gov/ordering.htm Printed on paper containing at least 50% wastepaper, including 20% postconsumer waste Preface Engaging in the business development process to create a community-owned biodiesel production facility was the central focus of this National Renewable Energy Laboratory contract. It forms the backbone of the business structure that allows Co-op Power to bring a wide range of sustainable energy products to its members and affiliates. There is tremendous excitement throughout its region moving this process along. Many people contributed to the underlying research reflected in this report. First of all, we thank the 2,000 members of Co-opPlus, who supported this development effort. We thank Congressman Olver, the National Renewable Energy Laboratory, the Department of Energy, and the United States Department of Agriculture, which assisted us in securing funding for initial business planning and development. We thank Tom Leue, who began this venture based on the 10,000 gallons of biodiesel he produced at his farm. Tom led the early feasibility research that showed this could be a viable option for the cooperative. We thank Lynn Di Tullio for her work on the cogeneration feasibility study. We thank Lawrence Union for his dedication and thoroughness while working through each iteration of the pro forma and overseeing our business development efforts for our biodiesel production facility. And we thank Shaine Tyson and Wes Berry for their assistance reviewing technology options and their business development support. It’s been a very exciting and rewarding project, one we trust will bring significant value to our region. Lynn Benander Greenfield, Massachusetts November 2005 iii iv Contents List of Figures ....................................................................................................................................... vi List of Tables......................................................................................................................................... vi 1 Goals and Results.........................................................................................................................1 2 Accomplishments .........................................................................................................................2 2.1 Task 1: Technical Feasibility and Economic Viability Assessment for Renewable Energy Products and Services for Either Onsite or Central Distributed Energy Resources.................................................................................. 2 2.2 Task 2: Assessment and Evaluation of Education and Outreach Materials............. 6 2.3 Task 3: Development of an Onsite Distributed Generation Implementation Plan for a Consumer-Owned Cooperative Business ................................................ 7 2.4 Task 5: Development of Centralized Renewable Energy Generation Fuel Production With a Plan for Cogeneration for a Consumer-Owned Cooperative Business Model.................................................................................. 10 2.5 Implementation Plan Summary.............................................................................. 19 Appendix A. Business Plan ............................................................................................................... A-i Appendix B. Biodiesel Production Facility Business Plan............................................................. B-i Appendix C. Study of Cogeneration Feasibility for Northeast Biodiesel LLC.............................. C-i v List of Figures Figure 1. Scoring overview........................................................................................................ 5 Figure 2. Touchstone Energy market consumer research results............................................. 17 List of Tables Table 1. Mission-Related Evaluation Criteria............................................................................ 3 Table 2. Business-Related Evaluation Criteria .......................................................................... 4 Table 3. Criteria for Fit With Cooperative Platform.................................................................. 4 Table 4. Ranking Overview Matrix ........................................................................................... 4 Table 5. Pro Forma for a Recycled Vegetable Oil Collection Service .................................... 13 Table 6. Comparison of Legal Structures for Group-Based Businesses.................................. 15 vi 1 Goals and Results The goal of this project was to define, test, and prototype a replicable business model for consumer-owned cooperatives. The result is a replicable consumer-owned cooperative business model for the generation, interconnection, and distribution of renewable energy that incorporates energy conservation and efficiency improvements. The objective of the project was to assess, analyze, and evaluate interconnected renewable energy technologies to identify options for interconnected renewable-sourced electric power and renewable fuels that are technically successful, economically viable for the co-op’s needs, and efficient. The outcomes of the project are: • A technically feasible and economically viable implementation plan for a consumer- owned, renewable-sourced energy business • A procedural process to advance energy conservation and efficiency improvements and the generation of renewable energy • A process for working with the local utility to interconnect solar energy systems with a networked grid. Co-opPlus has supported renewable energy technologies and programs. For example, it has: • Successfully developed a solar installation program for its members. More than 600 members are in the pipeline for installation, and more than 50 have installed or are in the process of installing a solar energy system. • Supported the GreenUp program in Massachusetts Electric Co.’s territory. One hundred two of its members purchase the green electricity product. • Built a new regional cooperative, Co-op Power, to serve as a vehicle for building sustainable energy resources across the region. A member equity share costs $975, and there are discount programs for low-income people, farmers, and Co-opPlus members. More than 100 people have joined. Co-op Power now offers a biodiesel blend for home heating that is priced lower than petroleum heating oil. It sells waste vegetable oil burners and offers a discount for products and services on the Energy Federation International Web site. Soon, it will provide a solar hot water kit at a deep discount to its members. • Built a biodiesel production facility and signed a contract for 75% of its output. Co-op Power is the majority owner of this renewable fuel plant, which is scheduled to begin construction in November 2005. It will begin with a production capacity of 4.5 million gallons a year and expand to 10 million gallons a year in 2008. 1 2 Accomplishments Co-opPlus of Western Massachusetts completed the assessments, feasibility analyses, and evaluations described in the following tasks and provided reports and deliverables that constitute a detailed