This year, companies that convert landfill gas (LFG) to energy may have a new end user — the city of Chicago. In June, the city signed an agreement to make the largest purchase of “green” electricity in the country. Under the agreement, 20 percent of the city's electricity eventually will come from landfill gas and other clean sources such as wind and solar energy.
The city and other members of the Local Government Power Alliance — including the Chicago Transit Authority and the Chicago Park District — have chosen Commonwealth Edison, also known as ComEd, Chicago, to provide the power. After examining several proposals from clean power companies, ComEd's proposal underscored the city's goal to develop a local market for renewable energy, according to city officials.
No other city has taken such a bold move: Only the utilities themselves buy larger amounts of power from producers. With many cities and states struggling with an energy crisis, Chicago's move may urge other large entities to follow its lead.
ComEd will provide 10 percent of the city's power from “green” sources in the first year, moving to 20 percent after five years. The company will purchase the power from landfill gas-to-energy (LFGTE) businesses first, moving to sources such as wind farms and solar energy fields later. Up to half of the green power will come from landfill gas, including that from the CID landfill on Chicago's South Side, which has been selling methane-produced energy to ComEd since 1989.
Today, not enough green energy is produced to fulfill the city's goal of supplying 20 percent of its power from such sources. But the city is hoping that by demonstrating its commitment through this agreement, more sources will come on-line in the next five years. By the fifth year of the agreement, the city is expected to produce 249,000 fewer tons of carbon dioxide, 1,884 fewer tons of sulfur dioxide and approximately 1,000 fewer tons of nitrous oxides.
Environmental groups have praised the city's decision, which comes on the heels of President George W. Bush's recently announced energy plan. Bush's plan primarily focuses on traditional sources of power such as coal, oil, gas and even nuclear power. Currently, alternative renewable energies cost more than these traditional sources, but the city's agreement may spur demand for clean power and drive prices down. In the past, the solid waste industry also has supported tax credits for projects that use landfill gas for electrical power.
Furthermore, ComEd's profits from the sale of green power to the city, which is the amount above the regular electricity rate, will go into a reinvestment fund. The fund will be administered by the Environmental Resources Trust, Washington, D.C., to fund development of new renewable energy sources in the region. About $300,000 is expected to go into the fund by the end of the first year, growing to about $1 million by the end of five years.
Environmentalists such as the Environmental Law and Policy Center, Chicago, have urged the city to continue to seek new sources of renewable energy, instead of relying on existing landfills with which it already has relationships. This “adds nothing in terms of energy to the grid,” says executive director Howard Learner. Still, the agreement is a “good environmental step forward for Illinois,” Learner says.
For its part, ComEd has spent much of the past two years moving toward more environmentally sound energy sources. The company, once known for running the largest group of nuclear plants in the country, no longer generates its own power, after selling off its coal-fired power plants and allowing a sister company to manage the nuclear plants.
Instead, the company has focused on diversifying its power sources and moving further into renewable energy. Last year, ComEd agreed to buy electricity from residential and commercial customers who generate power from photovoltaic cells, or wind generators, installed on their properties.
On a related note, Internet-based trading in green power has become a reality in the Midwest. Last year, Automated Power Exchange, Santa Clara, Calif., opened the APX Illinois Market in Chicago to broker buying and selling renewable energy in the Chicago region. Operating in ComEd's northern Illinois service area, traders can purchase Green Tickets, the premium that buyers are willing to pay for renewable energy. To qualify for the APX Illinois market, energy must come from landfill gas, biomass, wind, solar or geothermal sources, as well as small hydroelectric power plants.
“No matter what happens in the energy market,” says Mary O'Toole, ComEd's director of environmental services, “we don't have all our eggs in one basket.”