For years, on-site power producers (i.e. solar panel systems) in New York were compensated by utilities for excess electricity they injected into local grids (instead of being used on-site) based on a Net Energy Metering (NEM) rate equal to the utility’s all-in electric rate.

On behalf of the team at 5, I am pleased to forward our market letter for the third quarter of 2018. In this letter we focus on two topics, (i) the increased interest of large corporate purchasers in virtual power purchase agreements with renewable generators, and (ii) the upcoming mid-term elections and the possible impacts such elections could have on state and federal energy policy. I have to start, though, by expressing all of our genuine sadness at the recent passing of Phil O’Connor. Phil was one of the true leaders in in the deregulated industry and was a driving force in the opening of competitive energy markets throughout the country. He also played a pivotal role in bringing retail choice to Illinois. More importantly, he was a fine person who truly cared for others - he will be sorely missed.

On behalf of the team at 5, I am pleased to forward our market letter for the first quarter of 2018. This letter focuses on a change taking place in the energy market and its impact on our clients. Historically, energy procurement was separated from facility operations. A procurement team and/or an advisor worked with competitive retail suppliers to manage commodity prices. In parallel, engineers worked with an operations team to reduce energy consumption. Today, large energy users can no longer approach energy procurement and facilities management as separate and distinct tasks – a cost effective energy management strategy must integrate facilities management and procurement. In this letter we discuss some of the factors that have driven this change and the importance of integrating procurement and energy management.

On-site battery power storage is a hot new energy option, but it does not come trouble-free. As Captain Kirk learned in Star Trek’s “Troubles with Tribbles” episode, some problems are easier to solve than others.

At this time, most utility batteries are being installed to manage frequency regulation, provide synchronized reserves, and other ancillary services of interest solely to grid operators. How much a retail power customer may save by installing a battery system, however, depends on a customer’s utility tariff rate, and how the power storage system is operated.

Imagine a friendly Borg that, instead of forcing assimilation, says, “Come join our Collective, and let us profit together.” That’s essentially what the New York Public Service Commission (NY PSC) is saying through its Reforming the Energy Vision (REV) process. Distributed Energy Resources (DERs), such as on-site solar and combined heat and power (CHP) plants, would participate in local grids to produce and trade power.

On behalf of the team at 5, I am pleased to forward our market letter for the final quarter of 2017. I began our last quarter’s letter with a discussion of the correlation between extreme weather and energy prices. I noted that since the extreme cold in the Northeast in 2013/2014, and the extreme heat in Texas in 2011, the energy market had not been tested to see how it would respond to extreme weather. Consider the market tested: the chart below tells the story.

Luthin Associates partnered with a host of other firms and ConEdison in the NY Prize competition, a first-in-the-nation challenge to help communities create microgrids.

A microgrid is a standalone energy system that is capable of operating on its own in the event of a power outage. One purpose of the project is to create a network of users who rely on the same microgrid. This community of microgrids will allow for local power generation using clean and efficient energy sources including, but not limited to, wind, solar, and combined heat and power (CHP).

Energy efficiency and renewable projects are no longer skipping down the same yellow brick road as they were this time last year. Similar to the Cowardly Lion, some are inching courageously forward despite doubts from customers and the industry, while others have stepped off the road until the way forward becomes clearer.

Changes at both the federal and state levels are creating a less certain future, but Dorothy assures me that the basic reasons for pursuing distributed energy resource (DER) projects remain viable, regardless of which federal policies remain intact.

On behalf of the team at 5, I am pleased to forward our market letter for the first quarter of 2017. This quarter marks 5’s fifth anniversary. While I try to avoid marketing in this letter, I cannot help but mention our most recent award, being named the 2nd best place to work in the State of Texas. When added to our other awards, this speaks to the unique company we are all building at 5.

Weather conditions, such as occasional daily and annual variations in temperature and moisture, have obvious temporary effects on energy bills. Heating costs rise when it is cold and dry, while cooling costs rise when it is hot and humid. Weather changes associated with climate change are expected to have long-term permanent impacts on those costs by causing weather extremes and changes to how power is produced.