|Clean Renewable Energy Bonds (CREBs)||
A CREB is a special type of tax credit bond providing rural electric cooperatives, municipal electric utilities, and government entities (including tribal councils) the equivalent of an interest-free loan for financing qualified energy projects. CREBs were created in the Energy Policy Act of 2005, and are largely modeled on the Qualified Zone Academy Bond program that provides tax credit bonds for school renovation and upgrades in certain qualified school districts. They deliver an incentive comparable to the production tax credit that is available to private renewable energy project developers and investor-owned utilities. $800 million of CREBs were allocated by the U.S. Treasury for 2006 and 2007 through an application process by qualified borrowers. The program was fully subscribed for 2008 for $400 million of bonds.
The simultaneous production of heat energy and electrical of mechanical power from the same fuel in the same facility. Cogeneration is achieved through the capture and recycle of rejected heat that escapes from an existing electricity generation process.
|Commercial Scale Wind||
Refers to wind energy projects greater than 100 kW where the electricity is sold rather than used on-site. This category can include large arrays of 100 or more turbines owned by large corporations, a single locally-owned wind turbine greater than 100 kW in size, or anything in between.
The process of connecting the turbine to the transmission lines and making sure it is operating within its normal or defined parameters.
Locally-owned, commercial-scale wind projects that optimize local benefits. Locally-owned means that one or more members of the local community has a significant direct financial stake in the project other than through land lease payments, tax revenue, or other payments in lieu of taxes. The term Community Wind refers to the method and intention of development rather than the size of the project.
|Community-Based Energy Development (C-BED)||
2005 Minnesota law requiring Minnesota utilities to establish tariffs for wind energy projects meeting specific requirements for local ownership. The tariff sets a framework for negotiation of power purchase agreements between utility companies and qualifying community-based energy projects where the payment for energy in the first 10 years of the project is higher than in the last ten years. Utilities are not obligated to enter into C-BED contracts, Under the original C-BED legislation, the tariff rate was capped at a net present value of 2.7 cents per kilowatt hour calculated over the life of the power purchase agreement (using the utility's normal discount rate). This cap was eliminated in 2007.
A system for establishing prices in which a utility is reimbursed for the legitimate costs it encounters in serving customers, plus a specific percentage for profit.
A promise in an indenture, or any other formal debt agreement, that certain actitivities will or will not be carried out. The purpose of a covenant is to give the lender more security. Covenants can cover everything from minimum dividend payments to levels that must be maintained in working capital.
A type of accounting ratio that helps measure a company's ability to meet its obligations satisfactorily. A coverage ratio encompasses many different types of financial ratios. Typically, these kinds of ratios involve a comparison of assets and liabilities. The better the assets "cover" the liabilities, the better off the company is.