Virginia Leaders in the “Green” Revolution

Virginia, like the rest of the world, is in the early stages of a “green” revolution that will result in the massive reordering of economic, institutional and governmental priorities to accommodate the reality of higher cost energy. While public policy sets the parameters — upholding environmental standards, designing transportation systems and influencing human settlement patterns — let there be no doubt it is the innovation and creativity flowing from the private sector that will actually make change happen.

In the future, Bacon’s Rebellion will pay more attention to the activities of private-sector players either based in Virginia or active here. There are two particular players that are worthy of attention, for they have gotten a jump on everyone else in building a track record and establishing credibility in developing renewable energy. They are AES Corp. and Intrinergy Inc.

AES, based in Arlington, provides electric generating capacity in North America and around the world, racking up more than $4 billion in revenues in the 1Q of 2008 alone. While much of this generating capacity burns fossil fuels, the company is rapidly building its holdings of renewable energy capacity. The company owns or operates 32 hydropower stations in nine countries, which collectively generate nearly 7,454 megawatts of electric power. The company owns/operates wind farms in California, Texas, the Midwest and Pennsylvania (the latter of which, in a recently announced deal will supply green energy to the Old Dominion Electrical Cooperative). The company is actively involved in developing 49.5-megawatt wind energy project in China as well.

In a new line of business, the creation, qualification and sale of Carbon Emission Reductions, AES’s Greenhouse Gas Services division works on projects to reduce greenhouse gases like carbon dioxide and methane. One current example is a project with Malaysian oil mill owners to capture and destroy the methane emissions that are a byproduct of palm oil production. The market for carbon emissions reductions is estimated at $10–15 billion annually.

Meanwhile, the company is laying the groundwork for solar energy generation as well.

Intrinergy, based in Richmond, isn’t nearly as large as AES, but it is growing fast. Formed in 2005, the company has developed an expertise in producing clean-burning gas from biomass: anything from wood chips, forest residue and yard clippings. The technology is particularly suited to industrial clients who can use the gas for cogeneration: generating electricity and using the waste steam for industrial processes.

Intrinergy doesn’t just design and build cogeneration plants. It also lines up supplies of waste byproducts to feed the cogeneration units. Currently, the company buys about 7,000 tons of waste byproducts a month for its European and domestic operations, reports Garry Kranz for Virginia Business magazine. The company also provides the financing for the projects, funding the full cost of constructing the energy generation facilities. That way, the client can share in energy savings without putting up any of its own capital.

The company has built plants in Mississippi, Ohio and Germany, and it has another 35 facilities in the pipeline in North America and Europe. Says President John Keppler: “We believe realistically that we could invest $2 billion to $3 billion in renewable energy over the next five years.”

Ironically, Intrinergy has no active clients in Virginia, although the company is in contact with a number of companies that are interested in its services.

AES and Intrinergy are just two of the more prominent companies active in Virginia. There are many more enterprises creatively laying the groundwork for a transformation of the global energy economy, not to mention a growing number of financiers, attorneys and business consultants who supply the intellectual capital to identify deals and close them. I will bring them all to the attention of Bacon’s Rebellion readers as the opportunity arises.

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  1. floodguy Avatar

    Jim, we must not leave off [ Thorium Power, LTD from your list. Thorium owns the leading technology in developing nuclear power by thorium. The company is located in McLean, VA and boasts some high profile advisors and board members, including Hans Blix.

    On their website Thorium Power states that claims to own the world’s leading technology in utilizing plutonium waste from old nuclear stockpiles, which it will convert to elecricity generated from existing nuclear power plants, while eliminating as much as 80% of its radioactive waste.

    Thorium waste has a decreased lifespan, generation productivity yields 1/3 the waste as uranium, and it cannot be weaponized.

    Utah Senator Orin Hatch and Nevada Senator Harry Reid have been in discussions about including it future energy initiatives. Sen. Hatch did publically announce his favorable position to it last November just prior to the passage of EISA 2007. It missed that legislation but Reid followed up with interest in thorium in futgure legislation.

    Next week Sen. Harry Reid will unveil a democratic senatorial energy plan. Will thorium be included?

    If nuclear is going to play a bigger role in new generation to fight global warming, then thorium’s advantages are very worth pursuing. Thorium nuclear technology has been around since uranium. However, it was shelved back in the 50’s because it lacked the dual purpose of power generation and weaponization.

    In this new age of non-proliferation and nuclear waste reduction, thorium is much better suited for our future.

  2. Anonymous Avatar

    ” will result in the massive reordering of economic, institutional and governmental priorities to accommodate the reality of higher cost energy.”

    You mean like offshore drilling?


  3. Anonymous Avatar

    I think Floodguy is right about the thorium cycle. It has real promise, as I recall from my chemistry days. I know nothing about current plans or economics, but it would seem at first glance to be a real no-brainer.


  4. Michael Ryan Avatar
    Michael Ryan

    For AES, I’m guessing almost all of that $4B/yr comes from those fossil fuel plants.

    A bit of simple math. The North Anna nuclear station alleges it generates 1,786 megawatts, that being enough to supply 450,000 homes, or 252 homes per megawatt.

    AES generates 7.5 megawatts at its hydro plants? That’s enough for 1,890 households. Spread across 32 hydro plants that comes out to an average of 59 households per hydro station.

    So, I’m guessing these must be really green micro hydro plants? About the size of a good beaver pond.

  5. Michael Ryan Avatar
    Michael Ryan

    And re the earlier post about overheated drilling rhetoric. How is it that burning oil is bad, but burning grass clippings is good?

    Yes, I understand that carbon from clippings just gets recycled into more grass in my yard. However, my grass is stupid, and it has no idea where the CO2 came from; it just uses it.

  6. Groveton Avatar

    “While public policy sets the parameters — upholding environmental standards, designing transportation systems and influencing human settlement patterns — let there be no doubt it is the innovation and creativity flowing from the private sector that will actually make change happen.”.

    Ahhhh yes … the quaint Republican belief that everything good comes from something called ‘the private sector’. Is that the ‘private sector’ like Fannie Mae? Or, the ‘private sector’ like Dominion – Virginia?

    Jim – who invented the internet (I mean besides Al Gore)? Was RFC625 written by people at IBM? No, it was written by people at ARPANET – a US government agency.

    Who invented the World Wide Web? Was it Microsoft? No, it was CERN – a lab owned by a consortium of European governments.

    Who discovered the curative effects of penicillin? Was it the reseach department of Pfizer? No, it was Alexander Fleming working as a researcher at St. Mary’s Hospital – financed by the British government.

    Who invented the process for freeze drying food? Was it Birdseye? No, it was NASA.

    What is the Republican plan for fighting climate change? Wait for an invisible hand to wave away the CO2.

    There have certainly been innovations in the private sector. Gordon Moore and the gang from Fairchild Semiconductor come to mind – although, even that company got some timely funding from NASA to develop the Apollo Guidance Computer.

    I believe your statement that there is “no doubt” that the private sector will provide the creativity and innovation to solve the climate change crisis is supported by neither history nor logic.

  7. Larry Gross Avatar
    Larry Gross

    yeah… you forgot GPS – Groveton.

    I think when Jim says "innovate" – he does not intellectual creativity as much as he means finding efficiencies and focusing on productivity….

    I think there is no doubt that many discoveries do not come from the private sector but from academia and government-sponsored R&D.

    DARPA – is responsible for much of the major technologies now profiting the private sector – who simply do not have the financial staying power necessary to focus entirely on R&D.

    Fair to say… also…that some DARPA efforts are financial black holes also though.

    R&D is the definitive private sector version of guns & butter if you will.

    The fundamental question with the private sector is how much money can a company put into R&D –

    … IF it's competitors are going to put nothing into R&D?

    How long can GE afford to divert some of it's profits to R&D if it's competitors are going to plow their profits back into making their companies bigger and more powerful and attracting more and more investors… who are expecting short-term ROI….

  8. Groveton Avatar

    Competition applies to companies and countries. A company can conceivably reduce its cost base and compete against new entrants on price (although this is harder than it sounds for an incumbent). I don’t see how a country with a growing population can do that. Automation provides some potential but:

    a) Lots of countries are now sufficiently safe to invest the capital for automation in those countries

    b) Automation reduces labor and jobs

    Alternately, incumbent companies and countries can innovate and try to bring new things to market. Others will copy your successes so you have to keep inventing.

  9. Anonymous Avatar

    It is going to be interesting to hear Al Gore’s speech today on how the U.S. should start an initiative to have 100% OF our electrcity from renewable sources within ten years.

    That’s an ambitious plan considering even the wind energy folks only figure on 20%. It will require mothballing hundreds of plants prematurely and building a lot of storage capacity we don’t have now.

    Also in the news a story that housing starts are up 9%, but they would haveben down 4% except for a change in building codes in New York city. I don;t know the details but it sounds like a partial vindication of Jim Bacons theory that zoning is preventing more urban development.


  10. Jim Bacon Avatar
    Jim Bacon


    You are certainly querrelous today! It’s one thing to invent a new technology like nuclear power, the Internet, whatever, and another thing to apply that technology commercially in cost effective ways.

    In the United States, government has traditionally played a dominant role in basic research — advancing the frontier of science, pursuing scientific inquiry which would be too expensive for private companies to justify. But the private sector figures out how those technologies can be applied in the real world — identifying markets, creating new products and adapting technologies.

    Are those activities in which governments have distinguished themselves?

    Are you suggesting that the commercialization of green technologies is better left to the government?

    What exactly *are* you saying?

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