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State of the StatesBiomass Thermal Policy Incentives
A BTEC WebinarAugust 6, 2014
Quick notes• Two Audio Options: Streaming Audio
and Dial‐In.
• Streaming Audio/Computer Speakers (Default)• Dial‐In: Use the Audio Panel (right side of screen) to see dial‐in instructions. Call‐in separately from your telephone.
• Ask questions using the Questions Panel on the right side of your screen.
• The recording of the webinar and the slides will be available after the event. Registrants will be notified by email.
• Introduction
• Residential Incentives: John Ackerly
• Commercial Incentives: Adam Sherman
• Renewable Heat NY: Ellen Burkhard & Ryan Moore
• Q & A Session
Webinar Speakers & Outline
About BTECThe Biomass Thermal Energy Council (BTEC) is the industry trade association dedicated to advancing the use of biomass for heat and other thermal energy applications.
Why was BTEC established?
• To advocate for and promote the biomass thermal industry in the national energy policy debate
• To reach out to and educate the public and decision makers on the benefits and advantages of using biomass for heat and CHP
• To develop biomass energy research and analysis that enables sound investment and policy decisions
4
Who We Are Technology, Fuel, and Geographically Diverse
New State Policy Map AvailableVisit biomassthermal.org/legislation/stateincentives.asp after today’s event
Residential Incentives Speaker
John AckerlyAlliance for Green Heat
John AckerlyAlliance for Green [email protected]
Trends in State Incentives for Residential Wood Heating
BTEC State of the States WebinarAugust 6, 2014
Alliance for Green Heat• Promote cleaner and more efficient residential wood heating
• 501c3 non‐profit group based in Takoma Park MD
• Founded in 2009
• Main activities• Education: blog & newsletter
• Advocacy: state & federal agencies
• Technology competitions: Decathlon & Workshop
States with high unemployment and/or little natural gas access are experiencing fastest growth of wood heat.
Federal Incentive
• IRS Section 25C: Personal tax credit for biomass stoves.
• EPA certification not required, so all pellet stoves eligible
• 75% LHV efficiency is required but manufacturers can self‐certify test in their own lab without disclosing methods or results.
• IRS never issued any guidance.
• Result: all stoves become eligible, many of which are far below 75% LHV
2009 –2010UP to $1,500
2010 –2013$300
2014
None
Purpose of Government Incentives?1. Help launch a technology that is not cost competitive on its own:
think solar or automated pellet boilers.
Examples: Maine, New Hampshire, Massachusetts, New York
2. Help reduce pollution
Examples: Montana, Arizona, New York
3. Help steer consumers to cleanest and most efficient models
Examples: Oregon, New York, Maryland
1. Help homeowners reduce fossil fuel
Examples: Federal tax credit
State Incentive Programs10 programs in 9 states with renewable energy incentive programs for wood and pellet stoves
and boilers
2 of the programs are virtually never used
Maine stove program is pretty strict & small
rebate amount
Alabama program is on books, but even retailers didn’t know
about it.
Benefits to the state1. Steer consumers toward cleaner products
2. Help ensure professional installation
3. Help low‐income families affordably heat home & reduce need for energy assistance
4. Reduce wood smoke pollution
5. Reduce fossil fuel use (for states with renewable energy goals)
6. Reduce electric demand, especially in coal dependent states• peak load demand in wintertime
What is a state’s price point for meeting some or all of these goals? $500, $1,000, $5,000?
Problems for the state1. “Free riders”: people who would make the purchase
anyway, but take the incentive as a bonus.
2. Not enough people using the incentive
3. Too many people using the incentive
4. Unforeseen & excessive administrative burdens on agency
5. People finding unintended loopholes
6. By‐passing low‐income populations
Trends• Towards including wood and pellet appliances in renewable incentive programs.
• Towards technology neutrality and including thermal in state RPS programs.
• Most new incentive programs are for indoor pellet boilers not stoves.
• Requiring professional installation (MD & NY)
• Home Energy Audits (right sizing equipment)
• Requiring stricter emission limits than EPA regulations
• In future, minimum efficiency is likely to part of programs
• Requiring dedicated outside air (Maine & Oregon)
Rebate of $700 for pellet stoves and $500 for wood stoves
Must displace electric, oil or propane heat
83% of households chose pellet stoves over wood stoves
About a third of households with existing stoves turned intheir old one
MEA Wood & Pellet Stove Grant Program
Eligible stick (log) stoves must:* Emit no more than 3 grams of particulate matter (PM)/hr
Eligible pellet stoves must:* Emit no more than 2 grams of PM/hr
Fossil Fuel Reduction of a $2,000 Wood/Pellet Stove=
Fossil Fuel Reduction of a $20,000 Solar PV
• Both systems can displace equal amounts of carbon from fossil fuel: 3 tons.
• 1 kw system, 1 cord of wood or 1 ton of pellets all displace about 1 ton of carbon from fossil fuels.
Transforming Wood Heat in America: A Toolkit of Policy Options
Full report available at: www.forgreenheat.org/resources/toolkit.html
Future of wood and pellet heating is in full swing in Europe ...
Solar and biomass feed into same tank for space heating and domestic hot water.
Or, instead of heating water, stove fans send hot air through ducts to nearby rooms.
John AckerlyAlliance for Green Heat
6930 Carroll Ave, Suite 407Takoma Park, MD 20912
(301) 841-7755
Commercial Incentives Speaker
Adam ShermanBiomass Energy Resource Center
An Overview of Biomass Thermal Energy Policy Opportunities in the Northeastern US BTEC Webinar
August 6, 2014
Adam Sherman
Presentation Outline
• Introduction• Regulatory Policy Review• Financial Policy Review• Legislative Policy Review• Policy Considerations• Q&A
Biomass Energy Resource Center (BERC)Advancing Community-scale Biomass Energy in North America
BERC is a program of the Vermont Energy Investment CorporationA mission-driven non-for-profit whose mission is to reduce the economic and environmental impacts of energy production
and consumption
Technical Consulting• Project feasibility studies • Fuel supply assessments
and procurement• Third-party expert review• Develop and review of
standards• Market Assessments
Program Design & Implementation• Expansion potential
assessments• Program management • Training, and advisory
support services
Advocacy• Showcasing “best in
class” technology, practices, and projects
• Tracking market growth and impacts
Heating the Northeast with Renewable Biomass: A Bold Vision for 2025
www.nebioheat.org/vision
An Overview of Biomass Thermal Energy Policy Opportunities in the Northern Forest Region
http://www.veic.org/Media/berc/Summary‐BT‐Policy‐Report10.30.13.pdf
State Renewable Energy Plan TargetsState High‐level Target
NY State Energy Plan ‐ 30% renewable electric by 2015 and 80% reduction in GHG by 2050
VT State Energy Plan ‐ 90% renewables for total energy by 2050
NH RPS target ‐ 24.8% of electric from renewables by 2025
ME RPS target ‐ 40% of electric from renewables by 2017
MA RPS target – 15% by 2020
Property Tax
Incentives
Best Management Practices (BMP)
Heavy Cut Law
Forester Licensing
Logger Licensing
Biomass Harvesting Guidelines
New York Program 480a Recommended BMP None None Voluntary training program
None
Vermont Use Value Appraisal (UVA) Program
Voluntary AMP (Accepted Management Practices)
Permit required for heavy cut of 40 acres or more
None Voluntary training program
Regulatory standards for power plants. General guidelines under development
New Hampshire Current Use Program
Recommended BMP Various minor rules
State license required
Voluntary training program
Guidelines in updated 2010 BMPs
Maine Tree Growth Tax Law
Voluntary BMP Forest Practices Act & Chapter 23 standards to eliminate liquidation harvesting
Required licensing
Voluntary training program
State recommended guidelines for biomass retention
Massachusetts Forest Tax Law Program
BMP Manual Forest Cutting Practices Act
Required licensing
License required
Requirements through APS eligibility
Regulatory Policies – Forest Management
State Air Quality Permitting Threshold
Specific Limits for PM
New York >1 MMBtu/hour output 0.6 lbs/MMBtu
Vermont 4.5 MMBtu/hour output 0.2 lbs/MMBtu and demonstrated use of BACT
New Hampshire >2 MMBtu/hour output 0.3 lbs/MMBtu
Maine 10 MMBtu/hour output Best Available Control Technology (BACT) determined on a case‐by‐case basis
Massachusetts 1 MMBtu/hour output 0.1 to 0.2 lbs/MMBtu
Regulatory Policies – Air Emissions
State State Boiler Requirements
New York Requires ASME certified boilers primarily for public and commercial buildings. Local residential building codes regarding boiler certifications may vary.
Vermont Vermont requires all boilers to meet ASME standards however in 2011 the rules were revised to allow boilers with either Canadian Standards Association or European Committee for Standardization certification only for boilers under 250,000 Btu/hour (input).
New Hampshire New Hampshire allows EN303‐5 accredited boilers up to 300kWh (roughly 1.0 MMBtu/hr output) but requires everything else to be ASME stamped.
Maine Maine requires ASME boiler certification for public and commercial buildings. Local residential building codes regarding boiler certifications may vary.
Massachusetts Massachusetts has the most restrictive requirements – they require ASME boiler certification for public, commercial, and residential buildings.
Regulatory Policies – Boiler Safety
Financial Policies – State GrantsState Agency Funding Source
New York New York State Energy Research andDevelopment Authority (NYSERDA)
NYSERDA periodically issues competitivesolicitations for R&D grants that could beused for biomass thermal technologies orprojects.
Vermont Vermont Public Service Department(VT PSD) ‐ Clean Energy DevelopmentFund
~$2.6 to be granted in 2014/2015 as part ofModern Wood Heat Initiative.
New Hampshire New Hampshire Public UtilitiesCommission (NH PUC)
NH PUC offers grant funding (via noncompliance payments from RPS) for renewable‐energy projects installed at commercial, industrial, public, non‐profit, municipal or school facilities, or multi‐family residences.
Maine Maine Forest Service (MFS) $10 Million in one‐time ARRA funds wereavailable beginning in 2009. Funds havesince been allocated and currently no futurefunding of grant program is in place.
Massachusetts Massachusetts Department Of EnergyResources (DOER)
“Green Communities” state renewableenergy grant program allocates funds fromRegional Greenhouse Gas Initiative (RGGI).
State Administrator Requirements NotesNew York NYSERDA See next speaker from NYSERDAVermont Efficiency Vermont
(EVT)• Fuel storage of at least one ton (or at least 7
days of uninterrupted system operations without refilling fuel storage)
• Automated fuel feeding from fuel storage• On/off system controls• Ability to modulate firing as heating load
increases/decreases.• Systems must meet all EPA and VT standards
for PM emissions• Systems must be installed indoors by a
professional
• Offers $1,000 toward a pellet boiler or furnace system (no stoves)
• Additional $2500 rebate available starting Oct 1 2014 through CEDF
• Current funding comes from forward capacity credit payments and RGGI payments to the State of Vermont.
New Hampshire NH PUC • Primary residents (no second homes)• Thermal efficiency rating of 80% or greater• 0.32 lbs/MMBtu heat output or less for PM• Bulk fueled with a minimum of three tons
storage capacity
• Offers 30% or $6,000 toward the cost and installation of a pellet boiler of furnace system (whichever is less)
• Originally ARRA funded program now funded via Alternative Compliance Payments from NH electric utilities
• Additional C&I program offers 30% up to $50K
Maine Efficiency Maine • Whole home (no supplemental use)• 2 weeks bulk storage capacity• No vacation homes• Minimum efficiency requirements
• Offers $5,000 rebate
Massachusetts Clean Energy Center (CEC)
• Year round home or small business • Non‐compliance payments for APS • One time pot of funds ‐ $475,000 issued in
March 2013 – over subscribed as of June 6th 2013
• Offers between $7,000 and $15,000 toward high‐efficiency pellet boilers
• New 2014 “expanded heat Loan program”
Financial Policies - Biomass Boiler Rebates
Financial Policies – Tax ExemptionsState Sales Tax on Equipment Sales Tax on Fuel
New York Biomass boilers are subject to sales taxes.
Exempts wood for residential and multi‐family housing heating fuel from state sales tax and allows towns to also exempt the fuel from local sales tax. Other sectors (schools, businesses have to pay sales tax on pellets, chips and firewood)
Vermont Sales tax exemption for biomass boilers
Sales tax exemption for biomass fuel
New Hampshire No sales tax for any goods or services
No sales tax for any fuel
Maine Charges 5% sales tax on boilers Residential wood fuel is exempt. Commercial sector is taxed.
Massachusetts Charges sales tax on boilers (MA offers sales tax exemptions on solar hot water, PV, wind, heat pumps – just not biomass systems)
Residential heating fuels (including wood) are sales tax exempt. Commercial and industrial fuel is taxed but with some exceptions.
[1] There is no sales tax on the fuel in New Hampshire but there is a state stumpage tax paid on wood fuel at the point of harvest.
Legislative Policies
• Thermal Renewable Energy Credits (RECs)• New Hampshire • Massachusetts!
• Systems Benefit Charge (SBC) on unregulated heating fuels• Vermont (funding only low-income weatherization)
• Government Lead By Example (LBE) policies• Some building traction in VT and MA
• Building code requirements• Nothing yet but good examples for EE• Europe
Spectrum of Policies and Incentives Offered in NENY VT NH ME MA
Flexible Boiler Regulations √ √Sales Tax Exemption on Biomass Appliances
√ Partial Partial
Sales Tax Exemption on Biomass Fuel
√ √ Residential only
Residential only
State Income Tax Credit N/A
Pellet Boiler Incentives Soon √ √ √ √PACE Financing √Thermal RPS √ Almost
State Grants for Biomass Thermal Projects
√ √ √ √ √
Government “Lead by Example” for Biomass Thermal
√ √
System Benefits Charge Weatherization only
Mandatory Renewable Energy Targets Applied to Building Codes
Source: http://www.veic.org/Media/berc/Summary-BT-Policy-Report10.30.13.pdf
Barrier Potential Policy Solution
High capital costs • Federal 30% tax credit• State income tax credits• State funded rebate programs• Thermal inclusion in RPS in a way that creates “credit
worthy” thermal RECs used toward capital costsPublic awareness • Adopt policies such as “lead by example” programs by
state and local government• Provide program support services to show case “best in
class” projects using modern, efficient biomass thermal technologies
• Support education, outreach, and training for architectural, building construction, insurance, real estate, and engineering professions
Lack of regulatory framework for thermal sector
• Develop comprehensive “total energy” approach including electrical, thermal, and transportation energy
• Expand RPS to include thermal energy• Apply SBC to heating fuels
Expanded natural gas service into new jurisdictions
• Apply a SBC to natural gas to further fund thermal efficiency and renewables such as biomass
Expanded use of electric powered air source heat pumps
• Create policies to encourage the combined use of biomass boilers and heat pumps as back-up systems
Policy Options for Overcoming Market Barriers
Systematic Approach to Advancing Modern Wood Heating in other Regions of the US
Legislative Policy
Programmatic
Support
Regulatory Policy
Financial Support
Adam Sherman, ManagerBiomass Energy Resource Center at VEIC128 Lakeside Ave. Suite 401Burlington, VT 05401Tel: +1 802 540 7863Email: [email protected]: www.biomasscenter.org
Contact Information
Renewable Heat NY Speakers
Ryan MooreNYSERDA
Ellen BurkhardNYSERDA
Renewable Heat New York
BTEC webinar August 6, 2014
Ryan MooreProject Manager
Ellen Burkhard, Ph.D.Senior Project Manager
Renewable Heat New YorkGovernor Cuomo’s 2014 State of the State Renewable Heat New York Initiative Announced
$27 million commitment to help the high‐efficiency and low‐emissions biomass heating industry reach scale and be self‐sufficient.
Commercial pellet boiler heating systems
Residential pellet boiler heating systems and stoves
Residential/small commercial advanced cordwood boilers with full thermal storage
R&D
Workforce development
John Rhodes, President and CEO, NYSERDA announcing Renewable Heat NY July 29th, 2014. Photo credit: Pyramid Energy EES.
Renewable Heat NY Launch
80,000 Btu/hr Evo World pellet boiler and buffer
tank
Pellet conveyance between pellet storage shed and pellet boiler
Pellet delivery truck supplying pellets to the
pellet storage shed
Vincent’s Heating and Fuel bulk pellet delivery
truck
Call for Qualified Pellet Boiler Technologies
Low mass (low volume)
Sensors and controls to optimize combustion performance
85% thermal efficiency (HHV)
PM2.5 < 0.080 lb/MMBtu
Fully automatic
Call for Qualified Advanced Cordwood Boiler Technologies
Low mass (low volume)
Sensors and controls to optimize combustion performance
Must pass Brookhaven National Laboratory (BNL) Partial Thermal Storage Test Method and be approved by NYSDEC
Annual efficiency > 60%
* BNL PTS test – cordwood, start up, high burn, burn out phases for both PM and CO
Large Commercial ProjectsIncentives are offered to offset the installed costs for high efficiency, low emissions pellet boiler heating systems that use premium wood pellets to displace boiler fuel use at facilities without access to natural gas.
Project Type Incentive Maximum Incentive per Facility
Pellet Boileroutput over 300 MBtu/h (88 kW)
20% of Total Installed Cost $100,000
Tandem Pellet Boilers with totaloutput over 300 MBtu/h (88 kW)
25% of Total Installed Cost $150,000
Sizing < 60% design day load, thermal storage, careful system integration with existing heating system and heat distribution system and controls.
Technical assistance for energy study, and review of commissioning and first year of M&V.
Pellet Stoves
The following incentives are available toward the purchase of a new pellet stove for use in a primary residence, without natural gas service:
Qualification Incentive Amount
Market Rate with Recycling $1,000
Income Qualified (No Recycling) $1,000
Income Qualified, add optional Recycling $1,500
The new stove can provide either primary or supplemental heating and must be at or below 2.0 grams per hour particulate matter emissions on the ‘EPA List of Certified Wood Heaters’ (latest version May 2014).
Eligible Equipment Customer Type NYSERDA Incentives Total Program Incentives Available via this
SolicitationBeginning July 2014Retire existing outdoor or indoor wood boiler and replace with Advanced Cordwood Boiler and Full Thermal Storage
Residential and Small Commercial
20% with maximum of $4,000 each unit (andadditional $4,000 for
recycling existing wood boiler)
$3,000,000
Beginning July 2014Pellet Boilers (<300,000 Btu) and must include Thermal Storage
Small Commercial 25% with maximum based on system size (Table 2
below)
$1,710,000
Beginning April 2015Pellet Boilers (<300,000 Btu) and must include Thermal Storage
Residential 25% with maximum based on system size (Table 2
below)
$3,465,000
Beginning April 2015Advanced Cordwood Boiler with Full Thermal Storage (fuel switching)
Residential 20% with maximum of $4,000 each
$1,575,000
Renewable Heat NY Biomass Boiler Program
Low‐interest financing is also available
•The Program will use a network of qualified installers and contractors to implement projects.
•NYSERDA is currently signing participation agreements with installers who meet the basic requirements.
•All approved Provisional Eligible Installers/Contractors, must have completed manufacturer’s training for the boiler brand they are installing. A certificate of completion or a letter from the manufacturer must be submitted as evidence of having successfully completed manufacturer’s training.
•In addition, at least one individual from the company or firm must successfully complete Renewable Heat NY biomass training: “Hydronics for High-Efficiency Biomass Boilers” or other approved instructor-led training* within six (6) months of applying to the Program.
Renewable Heat NY Installers & Contractors
•Applicants will be evaluated on past experience installing boilers, including system design and sizing; customer satisfaction; and other relevant experience (i.e. installation of thermal storage).
•Once NYSERDA approves an Installer/Contractor Application,NYSERDA will provide a Participation Agreement for signature.
•Once approved, eligible Installers/Contractors will receive designation as a Provisional Installer/Contractor and will then be eligible to apply for boiler system financial incentives as outlined in the Program.
Installer Selection
• The Installer works with the customer to assess the project and fill-out the application, signed off by the customer.
• The Project Application should include information about the home, existing boiler, and the biomass boiler being installed with the Manual J calculation attached.
• Once the application is received and meets the program requirements, NYSERDA will approve the application and notify the Installer.
Project Application Process
Left to right: John Rhodes (President and CEO of NYSERDA), Louis Okonski (Vice President of Evo World), Joe Martens (Commissioner of NYSDEC). Photo credit: NYS Department of Environment Conservation.
Renewable Heat New York
Questions?
THANK YOU!
Ryan [email protected]
1-866-NYSERDA, ext.3267www.nyserda.ny.gov/renewableheat
Renewable Heat NY
Question and Answer Session
Ask questions using the Questions Panel on the right
side of your screen.
The webinar slides and recording will be made available after today. Please fill out survey upon leaving.
Upcoming Thermal EventsView all at biomassthermal.org/events. Temperature Stacking in Thermal Storage
» Live lecture» August 7, 1PM ET. Hydronic‐Based Biomass Heating Systems» Online educational course» Sept. 15 – Nov. 21, 2014» Led by John Siegenthaler, Appropriate Designs. Second Annual National Bioenergy Day» October 22, 2014» Events nationwide for power, heat, pellets. Collaborative Stove Design Workshop» Upton, NY» Nov. 7‐11» Continuation of the successful Wood Stove Decathlon
We Are Helping Grow the Biomass Heating Market
Who BTEC Is•Non‐profit advocacy group with 130 members from U.S., Canada, Europe•All sectors represented, from landowners to end users
Why Consider Joining•Promote the use of biomass thermal fuels and technology to all industries•Achieve policy parity at the national and state levels•Share best practices and drive innovation and research•Recognition of our company’s leadership and achievements
Join Us!Membership levels tailored to a company’s size. Ask me about how to join, email
[email protected], or visit www.biomassthermal.org
Thank you for attending today’s webinar and remember to fill out attendee survey.
For more information, contact:
Joseph Seymour
BTEC Executive Director
202‐596‐3974 x302
