Sustainable energy portfolio management

Abstract

Sustainable (renewable) energy market is stimulated by political and economical pressure to reduce ldquogreenhouse gasesrdquo emissions (United Nations Kyoto Protocol, signed by 169 countries, representing 61.6% of emissions, on December 2006), and the necessity to decrease oil demand dependency. This pressure translates into a rapidly increasing number of alternative energy financial and legislation tools which are available to energy producers, electric utilities as well as end-customers from different market sectors. Financial tools include: (1) Federal and State Tax Incentives, (2) Utility Programs. These financial incentives are available through a variety of grants, loans, and rebate programs. Some of the most common programs include: (3) Grant, Loan and Rebate Programs, (4) Personal and Corporate Tax Incentives, (5) generation disclosure rules, (6) property tax and sales tax exemptions, (7) public benefit funds, (8) net metering, and others. state regulations (mandates, renewable portfolio standards and goal-based programs) require power utilities to generate or purchase a certain percentage of electricity from renewable sources by a specific date. Currently, over 29 states have firm policies for renewable energy generation requirements. Other states have policies underway to include alternative energy sources in the regulatory requirements for power generation and energy purchase. This paper will discuss the topic of sustainable energy portfolio management based on the technical and financial assessment of current and future industry/market trends.