Michael STAVY,Energy Economist

I made it to Warsaw on time. The volcano in Iceland did not stop me. I rented one of the last cars in Paris.

I made a poster presentation of my paper, The Effect That a US Signature on a Kyoto-II Climate Change Mitigation Treaty (or an Equivalent US Domestic Climate Change Mitigation Policy) Will Have on the US Wind Industry, at the 2010 European Wind Energy Conference 20-23 April, Warsaw, Poland. This is a revised title (See Below). My paper was originally titled The effect of COP 15 (Copenhagen 2009) on the US Wind Industry. The original title would have made for a brief paper.

My poster is number PO #40 and is listed in the Poster Topic: "Carbon Prices, Emissions Trading other climate Change Policies and Investment Decisions". My paper was presented at the Poster Reception at 14:00 on Thursday 22 April 2010.

The cost of generating renewable electricity from wind, PV, solar thermal does not increase once it is installed. Demand and market forces as well as the cost of generation determine the market price of renewable electricity. This is because most of the cost is fixed and the fuel is free. My analysis, The Cost of Solar Electricity from Abengoa's Arizona CSP Plant with Storage, based on The Wall Street Journal (WSJ) article, Rebecca Smith, Staff Reporter, Solar Plant to Generate Power After Sundown, December 31, 2010 is available for uploading below.

As I stated above, demand and market forces as well as the cost of generation determine the market price of renewable electricity. The market price of electricity (but not the cost of generation) can also go up with the general price level. This is called inflation. The Federal Reserve, by statute, has the job of controlling �monetary� inflation. The New York Times (NYT), Chicago print edition, on 3/24/11 published Lawrence Meyer�s Op/Ed Why Rising Food and Energy Prices are Not a Big Worry. Meyer, a former member of the Federal Reserve Board of Governors, has the position that the Fed should ignore increases in the food and energy price components of the overall Consumer Price Index (CPI) when setting inflation targets. Since I am an energy economist, I was quite interested in Meyer�s analysis of energy prices and their effective on the CPI. I was also interested in his view on the CPI�s ability to measure inflation (increases in the household cost of living expense). I wrote my analysis of Meyer�s position, Why Rising Food and Energy Prices are a Big Worry. Read my analysis to understand why I put �monetary� as an adjective, surrounded by parenthesis, in front of inflation. It is available for uploading below.

Open access documents now available for downloading:

Matthew R Simmons� October 2000 White Paper, Revisiting The Limits of Growth: Could the Club of Rome have been Correct, After All?
M Stavy, The Cost of Solar Electricity from Abengoa's Arizona CSP Plant with Storage, based on The Wall Street Journal (WSJ) article, Rebecca Smith, Staff Reporter, Solar Plant to Generate Power After Sundown, December 31, 2010
M Stavy, Why Rising Food and Energy Prices are a Big Worry, My analysis of Lawrence Meyer's 3/24/11 NYT (Chicago print edition) Op/Ed article, Why Food and Energy Prices are Not a Big Worry.
M Stavy, Paper, The Effect That a US Signature on a Kyoto-II Climate Change Mitigation Treaty (or an Equivalent US Domestic Climate Change Mitigation Policy) Will Have on the US Wind Industry, 2010 European Wind Energy Conference, 20-23 April, Warsaw, Poland
M Stavy, Poster, The Effect That a US Signature on a Kyoto-II Climate Change Mitigation Treaty (or an Equivalent US Domestic Climate Change Mitigation Policy) Will Have on the US Wind Industry, 2010 European Wind Energy Conference, 20-23 April, Warsaw, Poland

In time for COP 17, I am also giving open access to my 2008 Latin Mexican Wind Conference presentation The Use of the Kyoto Protocol and its Clean Development Mechanism (CDM) to Help Finance Wind Plants in Latin American Countries, and my 2009 Michigan Wind Energy Conference presentation, A Mandatory US Federal Carbon Emissions Program (Kyoto-II) Will Reduce the Cost Advantage that Michigan Fossil Electricity has over Michigan Wind Electricity. This will allow you to increase your understanding of the UNFCCC and its Protocol in time for COP 17.

Go to the bottom of this page to download my 2008 LAWEA and 2009 GLREA Presentations.

COP 15 is expected to design an ambitious post-Kyoto (2013) climate change mitigation agreement (Copenhagen Protocol). President Obama and the Democratic majority in Congress have pledged that the US will help to establish and then join the Copenhagen Protocol. An ambitious US climate change mitigation scheme will both add the cost of carbon emissions to the cost of generating US fossil electricity and mandate (RES) wind be a certain % of the US gird�s electricity. This paper describes the US climate change mitigation scheme under the Copenhagen Protocol and its effect on the growth of the

wind industry.

Expanding US industrial employment and a US climate change (carbon) mitigation scheme under the Copenhagen Protocol are the two major drivers that will expand the US wind industry. Increasing national energy security and reducing the US balance of trade deficit are not major wind industry drivers because very little oil is used to fuel US power plants. At the time that this abstract was written, both the Copenhagen Protocol design and the US carbon mitigation scheme architecture under the Copenhagen Protocol were not known. The paper will be written when the Copenhagen Protocol design and the US carbon mitigation scheme architecture become known. First, this paper presents an overview of the Copenhagen Protocol. The author expects that the Copenhagen Protocol will have a global carbon cap (ceiling), assigned national caps, base year from which emission reductions are measured, compliance year by which the emission reduction cap must be reached, timetables, monitoring, verification and compliance procedures and country lists (Annex I, non-Annex I, Annex B) to differentiate the treaty obligations of different countries under the Protocol. Second, the paper describes the US climate change mitigation scheme. The author expects that the US carbon mitigation scheme will use the cap and trade emission control architecture. The architectural details include a standard emission allowance, offsets, carbon market organization, base year, compliance year, US national cap, economic sector caps, emitter compliance procedures and the initial allocation mechanism for allowances. Third, the paper concludes that the US cap and trade scheme expands the wind industry because it will reduce the relative cost advantage of fossil electricity. The author expects that this cost reduction will not be adequate to enable the wind industry to expand enough to reduce the US gird�s carbon content down to its assigned cap and to sufficiently expand US industrial employment. Until 2009, the US wind industry was doing quite well in the

. In 2009 the effects of the Great Recession hit the wind industry. In a EWEC 2008 paper, the author forecast that 2009 new installed capacity will be 28% less than 2008. The US cap and trade scheme will require additional US power industry policies. The author suggests that these additional policies include greater transmission access for wind, a smart national electric grid with energy storage, a wind friendly grid operator, feed-in-tariffs, a 20% by 2030 federal renewable electricity standard (RES) and US tax incentives.

Black ink illustration of wind turbines located in Southern California along I-10, San Gorgonio Pass, between the San Bernardino Mountains on the north and the San Jacinto Mountains to the south (near Palm Springs, CA). Painter: Christine BOIRY