When a building produces all the energy it consumes from renewable sources, it is referred to as a “net-zero energy” or a “zero energy” building (NZEB or ZEB). Such facilities typically feature a combination of aggressive efficiency efforts (both passive and active) and a large on-site photovoltaic (PV) solar power generation system.

The opening chapter of Alice in Wonderland is aptly titled “Down the Rabbit Hole.” Alice’s adventures begin when she follows a rabbit down its hole and consumes items that cause her body to expand and contract. Alice’s journey has been a metaphor for mind-altering experiences ever since.

While 2015 marked the 150th anniversary of Alice in Wonderland, it also marked the anniversary of the Jevons Paradox.  William Stanley Jevons, an English economist, observed that the increased usage of coal was leading to critical shortages. He concluded that traditional sustainable energy sources such as wind, biomass, and hydro were not going to make a comeback due to scarceness and their relative unreliability.

I am pleased to forward 5’s fourth quarter overview of the energy market. This issue focuses on two topics that were particularly significant in 2015. The first is the continued decline of the price of natural gas and electricity. While the price decline creates an opportunity for energy buyers, it is also accelerating the shift in generation from coal to natural gas. If continued, this shift should put upward pressure on natural gas and electricity prices. The second topic is the increasingly complex international, federal and state regulations that impact renewable energy development, and in particular, how these shifting regulations could impact on-site generation projects. The shifting regulatory landscape underscores the importance of fully understanding the utility tariff structure and potential regulatory risk before investing in an on-site renewable project.

Orbit City, the Jetsons’ hometown, gets all its power from renewable energy. When the wind blows and the sun shines, it makes the electricity that keeps the city humming. But what happens at night, or when the air is still?

When the sun and wind provide more power than needed, the excess is used to electrolyze water into hydrogen and oxygen, with no carbon emissions. When sun and wind power are insufficient, stored hydrogen feeds into fuel cells whose only output is power and water vapor. While this may sound like science fiction, all the components needed to make it happen have been around for decades.

In George Jetson’s world, Light Emitting Diodes (LED) are nothing new. Earlier light sources are only found in his kids’ history e-books. Back here in the 21st century, however, not all LEDs are Jetson-ready. While we are rapidly replacing fluorescent and incandescent lamps, and even some high intensity discharge (HID) lamps, care is needed when specifying LEDs for existing fixtures.

Rosie, the Jetsons’ robot maid, keeps the home clean and running like clockwork, all on renewable energy. But will she slow down if the wind stops blowing, or if clouds block the sun?

Many megawatts (MW) of wind and solar power are being added to grids across the U.S. While routinely intermittent until recently they represented such a small part of the system that their variability was inconsequential. That has begun to change.

I am pleased to forward 5’s third quarter overview of the energy market. In this quarter, energy markets continued the stable trend that characterized both Q1 and Q2. We continue to urge clients to take advantage of these historically low prices. The energy market’s price movement during the first three quarters of 2015 is shown in the following chart:

Rather than buying a solar power system, many commercial customers purchase just the power they produce by using a Power Purchase Agreement (PPA). Like retail power contracts, PPAs (which may run for 20 years) need to be reviewed by an experienced consultant, as well as an attorney before it is accepted by a customer. In a subsequent article, we will discuss the technical issues involved with solar projects, but for now, we will focus on the financial and commercial terms of an agreement.

Technical issues may compromise the value of an on-site photovoltaic (PV) system. Reduced output, PV outages, or electrical problems may leave a host wondering if the decision to go solar was wise.

One way to minimize this risk is to consider a Power Purchase Agreement (PPA), in which a developer owns, installs, and operates the equipment, so all such issues should be his/her responsibility. If the system goes down, the developer loses electricity sales. That is a good incentive to ensure a quality installation, and most PPA-based systems have a decent track record.