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REPORT: Solar’s Price Tag Keeps Getting Lower

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As solar energy installations spring up on rooftops and major power plants across the U.S., the average cost of going solar continues to fall, according to a report released today by the research gurus at the Department of Energy’s Lawrence Berkeley National Laboratory.

You can dive into the details of the report yourself here, but the gist of it is: Effective energy policy and hefty dose of American entrepreneurship have achieved something remarkable: built scale and lowered costs to make rooftop solar a real and growing part of our nation’s energy landscape. As an aside, we’ve seen especially strong adoption in low- and middle-income communities in the largest markets, which is an exciting sign that solar has truly become a mainstream option. Now that we have built this new solar economy, we had better make sure that policy and rules formed to support our old energy infrastructure doesn’t stand in the way of continued progress (we’re looking at you, utility attacks on net metering).

This latest edition of “Tracking the Sun” examined more than 208,000 PV systems installed between 1998 and 2012, as well as preliminary data from the first half of 2013. Key findings include:

  • The average installed price of residential and commercial PV systems completed in 2012 decreased by a range of roughly $0.30/W to $0.90/W, or 6-14%, from the prior year, depending on the size of the system. Installed prices for projects funded through the California Solar Initiative fell an additional 10 to 15% in the first half of 2013.
  • Historically, installed PV prices have declined an average of 5 to 7% per year from nearly $12/W in 1998, with particularly sharp reductions occurring since 2009.
  • The recent price decline in large part is attributable to falling average global module prices, which fell by $2.6/W from 2008 through 2012. Over the longer-term, installed system prices have also declined due to reductions in non-module costs, including inverters, mounting hardware, permitting and fees, and other costs.
  • Market-building policies that target non-module or “soft” costs represent a significant opportunity for continued price reduction. This is a particular area of focus for Vote Solar through Project Permit – check it out if you haven’t already! It’s designed to help solar stakeholders, municipal officials, and others understand how their town’s permitting practices stack up and what can be done to improve them to lower those costs.

The price declines found in Tracking the Sun add to a growing body of reports that illustrate U.S. solar industry success. Some of our favorites include:

  • Rapid Market Growth: PV installations totaled 723 megawatts (MW) in Q1 2013, which accounted for over 48% of all new electric capacity installed in the U.S. last quarter. Overall, these installations represented the best first quarter of any given year for the solar industry.
  • Strong Job Growth: Solar employs nearly 120,000 Americans across all 50 states. Solar job growth has far outpaced the general economy with 13.2% annual growth over 2011. (Source: The National Solar Jobs Census from the Solar Foundation)
  • Overwhelming Bipartisan Support: 92% of Americans agree that it’s important to use and develop more solar. (Source: SEIA National Solar Survey)

Original Article on The Vote Solar Initiative

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Solar vs. New York Electricity Rates

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New York has some of the highest electricity rates in the nation. But now more and more New Yorkers are turning to reliable solar to help manage their electricity costs.

Governor Cuomo just announced the latest round of the NY-Sun Competitive PV program, which will support 79 new solar projects totaling 64 Megawatts (MW). All told, the $54 million in state funding will leverage another $120 million in private investment for this much-needed energy infrastructure. Notably, these incentives have dropped from $1.39/Watt to $0.84/Watt over the past two years. New Yorkers are getting some serious solar bang for their buck due to healthy competition at work.

Many of the state’s colleges and universities joined the ranks of the solar powered. Clarkson University, SUNY Cortland, Rochester Institute of Technology and Cornell University were all awarded funding to develop larger-scale solar projects on their campuses. These and many other schools across New York are embracing solar as a way to reduce energy costs while meeting their sustainability goals. Schools also have the added benefit of using these solar projects to educate a new generation of clean energy leaders (e.g., check out the University of Buffalo’s solar system in action here).

Some utilities are embracing the benefits of solar power as well. The Long Island Power Authority is getting in on this year’s solar action having recently released their proposal to solicit an additional 100 MW of solar (proposal and FAQ here). Following last year’s 50 MW Feed-in Tariff program, LIPA has recommitted itself to bolster distributed solar development through a modified program design that will better capture competitive market forces and drive cost-effective deployment. Having previously offered comments to LIPA on ways to strengthen their wholesale solar solicitation (see here), we are strongly encouraged by these latest developments.

Specifically, LIPA proposes adopting an auction approach to set a fixed-price, 20-year power purchase agreement. Bidders will have a 120-day application period to submit their bid ($/kWh), after which LIPA will screen and rank qualified applications in order of bid price from lowest to highest. Raking bids until either 90% of the applications or 100 MW has been reached, the last project accepted would set the fixed price, of which all projects would then be eligible.

LIPA is also demonstrating how the development of distributed solar capacity plays a vital role for helping to offset costly upgrades to the electric grid. On the eastern end of Long Island, LIPA is facing an immediate need to substantially invest in transmission upgrades – to the tune of $84 million. With additional transmission and generation needed down the road, LIPA has rightly identified that the strategic deployment of solar could defer both immediate and future capital investments. By developing 40 MW of distributed solar in targeted areas of Long Island’s eastern end, LIPA projects a savings of $60 million resulting from deferred and avoided transmission upgrades and generation additions. Accordingly, LIPA has proposed to offer a premium of $0.070/kWh above and beyond the established fixed price for projects developed in these strategic areas.

LIPA is aiming for approval of their program proposal in September and to open the 120-day application period September 30th.

New York’s programs are driving down the cost of solar, building a strong local industry and laying important groundwork to transform New York into a solar powerhouse. And there’s plenty of opportunity for the Governor to do just that this year.

An overwhelming majority of voters (89% by our last poll) support increasing the use of solar to meet the state’s power needs. And despite messy politics, as demonstrated by a whopping 197 out of 213 legislators voting for the New York Solar bill this past legislative session, the vast majority of New York legislators share their constituents’ support for a long-term solar program.

In their NY-Sun announcement this week, the Cuomo administration committed to “work with the Legislature and explore administrative options to continue the tremendous success of NY-Sun beyond its current program horizon of 2015.”

The window is open, sun is shining in. We look to the Governor to make good on his commitment to extend the NY-Sun program through 2023 to keep New York going solar.

Original Article on The Vote Solar Initiative

Solar Power: Freedom and Independence

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One of the most compelling virtues of solar energy is the opportunity for freedom and independence.  Solar means you don’t have to wait for the utility or other powers-that-be to do the right thing…you can take matters into your own hands and do it yourself.  It’s democracy in energy decision-making in action.

So this 4th of July, we’d like to take a moment to celebrate some recent solar successes in the name of preserving solar rights, providing freedom from the tyranny of pollution, and allowing Americans to pursue the kind of power they want.

Our Thomas Jefferson, if you will, in this revolution is a municipal utility with a goal of 100% carbon-free power. After buying 80 MW of solar at mind-blowingly low rates of 6.9 cents/kWh,the utility is now on-track to achieve 48% renewables by 2017.  If you want to learn how they did it, we have a webinar scheduled for July 24. America, we can do this.

The California Legislature, playing the role of Ben Franklin, advanced an innovative new Shared Renewables program — a way for renters and others that don’t have their own roof to participate in the solar economy.  If you want to lead a similar charge in other states, check out the new Shared Renewables Model Rules we just released with IREC.

In New York (Lewis Morris, natch), the state tripled the net metering cap – clearing the way for many more New Yorkers to use solar and other renewables to meet their own energy needs.  And we expect more solar greatness still to come from this home of Lady Liberty.

Minnesota (umm, John Adams?) did the peoples’ will and passed sweeping new renewable energy policy that included 450 MW of strong solar provisions. Colorado also doubled its renewable renewable energy goal.

Louisiana (you choose this one… full list here) stood strong for solar rights by fighting back another attempt to dismantle net metering.

And we beta launched Project Permit, a new campaign to empower Americans nationwide to cut red tape and reduce solar permitting costs in their own communities.

It’s worth noting that this fight for solar freedom faces an incredibly well-funded opposition.  Big Fossil isn’t going down without a fight.  Read this article about how the Koch brothers are fighting to make sure that Congress protects their profits–at the expense of our children’s future. If your blood isn’t boiling by the end of it, call your doctor, because you don’t have a pulse…

But you know what? They are losing.  This USA Today article does a great job chronicling the renewable roll-back that wasn’t. If history tells us anything, it’s don’t bet against the American people.

Original Article on Vote Solar

Palo Alto Municipal Utility Goes Big on Solar

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The city of Palo Alto (CA) has set a goal of 100% carbon-free power for its municipal utility.  To achieve this goal, they are going solar in a big way…and with some mindblowing results.

The utility just signed 80 MW worth of contracts with 3 solar plants  (40 MW, 20 MW, and 20 MW) at a great price: 6.9 cents/kWh over a 30 year term.  Try building a new nuke or coal plant at that price.

The total output of these 3 solar plants are enough to serve about 18% of the city’s load, well over the 65,000 residential customers in the city.

When these contracts come online, the city will be powered by 48% renewable energy by 2017.  Quite a bit higher than the current state requirement of 33% by 2020.

And the cost impact?  1/11th of a penny per kWh.  That’s right.  When the city approves renewable energy contracts they calculate the difference between the levelized cost of the renewable resource and the levelized cost of a comparable amount of non-renewable market power for the same period (doing their best to estimate the all-in delivered cost for both products, adjusting for time-of-delivery, transmission costs, capacity value, etc.) They use that difference to determine the net impact of the contract on the City’s average retail rates. So far, they calculate the total rate impact of all of their renewables contracts to be in the range of 0.11 cents/kWh.

The plants are to be built on distressed agricultural land in Fresno, Stanislaus, and Los Angeles counties.  To better ensure project viability, developers put up $30 – $35/kW in development assurance.

One more time, so it sinks in: Palo Alto is  buying 80 MW of solar at 6.9cents/kWh, on track to reach 48% renewables by 2017, and all at a cost-premium over non-renewable market rates of a de minimis 0.11 cents/kWh.  Truly remarkable.

These guys are early contender for utility solar champion of the decade.

Press release here.

Contracts here (pdf).

Original Article on The Vote Solar Initiative

Shared Solar Lands in California

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Solar is already a huge California success story. The Golden State is leading the nation in new installations, helping to drive costs down and reaping economic and environmental benefits as more and more of our power comes from the sun. Now momentum is building in Sacramento for a new approach that will let the state shine even brighter: shared solar.

The traditional panels-on-your-roof solar model is growing like gangbusters, but it simply doesn’t work for those who don’t own a suitable roof — say, those who rent their homes or office space, or a school with shaded roofs.  Shared solar allows these energy customers to instead subscribe to an offsite solar project and get credit on their utility bills for clean power produced. Other states including Colorado are already experimenting with shared solar programs (check out this article in GreenTech Media today and a new website highlighting all the shared renewables progress happening around the country). And this year, shared renewables is poised to become a reality on a larger scale in California.

Vote Solar and many allies are working to pass legislation in Sacramento that would create an initial pilot program of 500-1000 megawatts, enough to replace up to two big fossil-fueled power plants with clean energy over and above what’s required under the state’s other clean energy programs. Our coalition is supporting two shared renewables bills in Sacramento this year, Senate Bill 43 (authored by Senator Wolk), and Assembly Bill 1014 (authored by Assemblymember Williams). The bills are virtually identical, but they will be moving concurrently to make sure the momentum gets good shared solar policy to the Governor’s desk to be signed into law. SB 43 and AB 1014 will both be referred for an initial committee vote in the next few weeks.

Shared solar makes sense, but you can bet on some opposition from the big utilities since it would allow more of their customers to opt out of buying power from big dirty power plants. So we’ll need your help . . .

We’re excited to announce a new website where you can learn all about the California Shared Renewables campaign: CaliforniaSharedRenewables.org. Check it out and sign up to receive updates and critical action alerts as the bills move forward.

Shared renewables will give California another way to drive solar success to greater heights, throwing the doors wide open for even more sunny goodness: energy bill savings, local jobs, private investment, cleaner air and healthier communities. Together, we can give all Californians the opportunity to choose 100% renewable energy!

Original Article on The Vote Solar Initiative

The Hawaiian Electric Company: Utility Solar Done Right

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Our 2013 Utility Solar Champion Award goes to … drumroll please … The Hawaiian Electric Company (HECO).

Here’s why.  The Hawaiian solar market is taking off.  Just skyrocketing.  Check this article out:

“In 2012, a total of 16,715 PV permits were issued [in Oahu], a figure more than 170 percent of the previous 10+ years’ worth of PV systems installed across the entire state over that time.”

With nearly 100 MW of new solar installed across Hawaiian Electric Company service territories in 2012, Hawaii gets a larger percentage of its electricity from solar than any other state and is among the top states in solar watts per capita. Hawaii’s solar industry added 12,215 systems for Oahu, Maui County and Hawaii Island in 2012, exceeding the total of the previous 10 years combined. Indeed, cumulative solar power has doubled year-over-year since 2008 when net metering began.

A big challenge in sustaining this growth is ensuring that projects can be safely interconnected to the grid — one that was not originally designed with DG in mind.  And here’s where HECO’s leadership comes in.

Hawaii’s rules required a costly ‘Interconnection Review Study’ when a prospective solar system wanted to interconnect to a distribution line where combined generation totalled 15% of peak load.  The 15% limit is an engineering rule of thumb, and a very conservative one at that.  With Hawaii’s tremendous solar growth, many distribution lines were hitting that cap, and blocking further solar growth.  Check out these maps — the red areas were effectively closed to new solar (images are courtesy of Marco Mangelsdorf, ProVision Solar):

Oahu:

PV Saturation on Distribution Networks on Oahu

Maui:

PV Saturation on Distribution Networks on Maui

Hawaii (the Big Island, for mainlanders)

PV Saturation on Distribution Networks on Big Island

To manage high growth while maintaining safety, reliability, and power quality across the transmission and distribution infrastructure, Hawaiian Electric proactively engaged in a multi-party collaboration with local solar advocates and adopted a pioneering framework to allow more rooftop solar systems to connect to the grid. The new “proactive approach” includes enhanced modeling, monitoring, and planning to manage a grid that facilitates and maximizes distributed generation. The overall goal is a more transparent and efficient process for interconnecting higher levels of solar and other distributed generation.

The new agreement moves the trigger from 15% of peak load to 75% of minimum load — depending on the circuit, a near doubling of the amount of DG that can be intereconnected without a costly and time-consuming study.

From the PV Sub-Group Final Report (1-18-13) (pdf):

HECO will utilize the interconnection queue and other data points to establish a reasonable base case of anticipated DG development. Through its distribution and transmission planning effort, it will proactively plan for the aggregate system impacts from expected DG development in order to accommodate higher penetration levels. The coordination of interconnection and planning will identify opportunities where infrastructure upgrades can accommodate both DG and load such that a number of generators and customers can benefit from the upgrades.

Specifically, HECO will employ enhanced tools for modeling DG to inform both system and distribution-level planning and operations. Those models will leverage PV production data from individual DG systems, which members of the PV industry recently made available to HECO, to supplement utility monitoring tools. This improved modeling capability will, in turn, enhance a number of areas related to the interconnection of high penetrations of DG, including:

  • Assessing potential system and region-level impacts due to high penetrations;
  • Evaluating impacts to dispatch and generation, reserve planning, and response to ramping events;
  • Informing and streamlining the distribution level interconnection process; and
  • Helping to identify circuit penetration capabilities, potential issues, and necessary upgrades.

The overall goal of this collaborative approach is to create a more transparent and efficient process for interconnecting higher levels of DG while maintaining safety, reliability, and power quality across the transmission and distribution infrastructure.

The approach will benefit all parties involved, including customers, developers and utilities, as well as the broader public.  IREC’s press release has more.

Original Article on The Vote Solar Initiative

U.S Solar Permitting Costs: Bringing Them Down

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It used to be — way back in history, like 2008 — that the biggest barrier to growing solar markets was the cost of the modules.  Since then, module costs have come down around 80% — to the point that hardware costs are no longer the largest part of the overall cost of a solar system.

This is great news, because many of the remaining ‘soft costs’ can be improved via the efforts of local policymakers.  That means we don’t need technology breakthroughs to lower the cost of solar.  We just need leadership.

Take permitting, for example.  This excellent analysis by the Lawrence Berkeley National Lab shows that the cost to a solar installer to deal with permitting, inspection, and interconnection is about $0.20/W higher in the US than in Germany.  Other studies estimate that permitting can add as much as $0.50/W to the cost of a solar system.  This means you’re looking at an extra ~$1000 in paperwork costs for a typical 5 kW residential install.

With over 18,000 municipalities across the US setting their own solar permitting processes, getting a permit can either be a walk in the park, with simple and clear requirements, on-line procedures, and reasonable fees — or require multiple trips and a lot of standing in line.  Time is money.  Making this process straightforward and simple is a relatively easy way for policymakers to help reduce the cost of going solar.

So here’s what we are doing to help make it easy for policymakers to make the right decision when it comes to solar permitting.  Clean Power Finance is collecting data on permitting practices at the individual municipality level across the nation.  We are taking that data, and incorporating it into a website that will allow people to click through a map of the country, and find out the exact permitting practices in their town.  But wait!  There’s more!  The website will also grade each locale against Vote Solar and IREC’s nine best-practice metrics, and provide an advocacy toolkit to policy makers or solar advocates looking to bring their cities or towns up to best practices.  We call it “Project Permit.” Funding for the Project Permit website comes from Solar 3.0, a DOE-funded collaborative that has set ambitious solar permitting cost reduction goals.

Our hope is that Project Permit will be helpful in establishing a common understanding of best-practices in solar permitting, and will be a useful tool in the drive to turn our cities into solar-friendly communities.  When the website launches this summer, we’ll work with our members and other advocacy organizations to put together campaigns to drive change at the municipal level.  We’re really excited to give people a practical way to make effective change in their hometown.

In a similar vein, a few states — California, Colorado and Vermont, for example — have established helpful statewide permitting requirements or guidelines.  From experience, we know that these efforts can be politically charged — many localities don’t want the state telling them how to run their permitting departments.  It’s not a one-size-fits-all solution.  So, going forward, we are putting effort into developing a ‘menu of policy options’ for statewide action – policy ideas that could be worked into state legislation or administrative initiatives.  We will work with our partners across the U.S. to identify which options make the most sense for which states, and plan additional collaborations with local policy leaders to put them to work.

Stay tuned. For questions on Vote Solar’s permitting efforts contact Annie Lappé at annie@votesolar.org.

Original Article on The Vote Solar Initiative

Feed-In Tariff Approved in Los Angeles

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We’re thrilled to see that the LA Department of Water and Power (LADWP) is adopting a Feed-In Tariff (FIT) program.

We’d like to congratulate all the folks who, after three years of hard work testifying and developing the research and policy, made this victory possible (looking at you, LABC, Environment California, Sierra Club, Global Green, and many many more).

Here’s the break-down:

The initial program is for a total of 100 MW, at an initial fixed price of 17 cents/kWh.  20 MW tranches will be offered every six months, with price declines in response to market uptake.  The Board will consider a 50 MW expansion of the program in March.

LADWP has historically lagged behind other big California utilities when it comes to investing in solar: less than one half of one percent of Angelenos’ power mix comes from solar, and LA has far less rooftop solar per capita than the two other biggest utilities in the state, PG&E and Southern California Edison. However, LADWP and City leaders continue to make big strides to change that.

In late 2012, LA City Council unanimously approved two long-term solar power purchasing agreements for 460 megawatts of clean solar power. LADWP says that combined with a new LADWP-owned property that will support a 250 megawatt solar project, and a commitment to procure 150 megawatts from rooftops in the City through the Feed-in-Tariff (FiT) program, solar will provide enough green energy annually to serve approximately 331,000 Los Angeles households.

We’d like to see City leaders keep building on that momentum and get up to speed with the rest of this increasingly solar-powered state. It’s time for LA to break its dirty coal dependence and boost the local economy by investing in lots of new rooftop solar. A good goal for LA would be to achieve its proportional share of Gov. Brown’s vision for statewide clean distributed generation, which would mean 1,200 MW of rooftop solar in LA by 2020.

But for now, celebrate this victory.

Original Article on The Vote Solar Initiative

New York Announces Big Solar News

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Some BIG solar news from New York! Today, in his 2013 State of the State, Governor Andrew Cuomo made some significant solar proposals. Proposals that will work to fundamentally transform the state’s solar market while broadening access to solar, enabling the industry to scale and reducing the cost.The Governor called for a major expansion of his NY-Sun Initiative.  The original NY-Sun, announced by the Governor at last year’s State of the State, called for doubling solar installations in 2012 and quadrupling in 2013.  However, that program was too small and too intermittent–while helpful, it fell short of accomplishing the job of market transformation.This year, the Governor announced a long-term commitment to NY-Sun, expanding the program into a 10 year, $150 million/year program. If we’re doing our math right…that’s a billion and a half dollars to develop a world-class solar industry and unleash the many benefits that solar energy delivers.

Here’s the money quote from the Governor’s speech (full text found here).

Extend the NY-Sun Solar Jobs Program (page 31)
Last year Governor Cuomo created the NY-Sun solar jobs program to bolster the use of solar power in New York, while also protecting the ratepayer. The goal of NY-Sun is to install twice as much customer-sited solar photovoltaic capacity in 2012 as was added in 2011, and to quadruple the 2011 amount in 2013. The NY-Sun program is authorized through 2015. This year, Governor Cuomo proposes to extend the successful NY-Sun program, continuing through 2023 the existing annual funding levels established under the program. The extended solar jobs program will provide longer program certainty to solar developers than current programs, funded through 2015, and is expected to attract significant private investment in solar photovoltaic systems, enable the sustainable development of a robust solar power industry in New York, create well-paying skilled jobs, improve the reliability of the electric grid, and reduce air pollution.
If implemented correctly, the Governor’s long-term commitment to NY-Sun can build a robust and sustainable industry that will deliver solar energy cheaper than power from the grid. What we are looking for are the policies and programs that move beyond playing at the margins, and instead seek to develop a market that can grow and ultimately thrive–without incentives.We believe that the Governor’s 10-year commitment to NY-Sun can deliver this promise. Market transformation will be achieved through prudent incentives that phase-out over time while establishing supportive regulations that remove barriers and increase access to solar power.With New York at the crossroads of its energy future, the State has a unique opportunity to revisit its solar programs in a comprehensive fashion and build a sustainable market where cost-competitive solar energy is a core component of a 21st century energy infrastructure.

We’ve spent the last several years building support for these ideas, and calling for a long-term solar program to unleash solar throughout New York.  We’re pleased that the Governor is stepping forward with leadership.

Now comes the hard part: turning talk into reality.  The legislature needs to do its part, but a Governor sponsored bill is a very helpful step.

 

Original Article on The Vote Solar Initiative

 

Infographic: Solar’s 5 Year Climb

It’s been a wild five years for U.S. solar power. Record growth. Incredible price declines. A backdrop of economic recession. Intense global competition. Messy election politics. The growing pains of any maturing industry. Through it all, solar innovators and entrepreneurs in all 50 states kept making big inroads into one of the most entrenched industries around: energy.

This infographic is a reminder of just how far we’ve come in such a short time. Click it. Save it. Share it. Post it. And now let’s get back to work because there is so much farther we can go . . .

Original Article on The Vote Solar Initiative

New York’s Solar Blueprint

Amid the havoc wreaked by Hurricane Sandy, we’re glad to share some good news from New York . . .

The Empire State is at it again, making moves towards ensuring that solar energy is a significant part of its energy landscape. Having increased the state’s commitment to solar development with the NY-Sun Initiative in early 2012, Governor Cuomo and his team are back to work expanding the legacy of this program.

Last week the Governor’s office released the New York Energy Highway Blueprint – a plan to modernize the State’s energy infrastructure and propel New York’s clean energy economy through collaborative public-private partnerships.

Most important for clean energy supporters, the Blueprint recommends extending the State’s Renewable Portfolio Standard well beyond its current expiration date of 2015 and further expanding the NY-Sun Initiative. The plan also notes that providing long-term certainty through multi-year programs will be essential to unleash a growing and transforming solar market – music to our ears as it’s the song we’ve been singing in Albany for the past four years.

Furthermore, the Blueprint wisely recommends that any transmission investments be designed with an eye for facilitating the increased deployment of distributed resources and the dynamic smart grid of tomorrow. It also recommends that any replacement power proposal maximize the role of energy efficiency and clean distributed generation such as solar.

Many of the state’s leading clean energy and environmental organizations agree that the promise of an extended RPS and more robust NY-Sun Initiative will send a clear signal that New York is open for clean energy business. See our Joint Statement of Principles, here. As the Blueprint states, the 2013 RPS review by the Public Service Commission is the right opportunity to lock-in these programs in support of a solar energy future.

In the meantime, developers and customers are busy preparing for the first NY-Sun competitive solar solicitation due November 8th. Solar projects greater than 50 kW from across the state will be competitively selected based upon bids in dollars per kilowatt-hour ($/kWh).

This solicitation also includes two interesting design features that should help project development occur where it will deliver maximum benefits to New Yorkers. The Empire State faces a unique challenge in that the majority of the electricity demand (downstate in New York City) isn’t where there’s lots of obvious space for new solar development (upstate). “Geographic balancing” ensures that solar projects are deployed and delivering benefits throughout the state. Utilities have also identified strategic locations in their service territories where solar generation would provide the greatest benefits to the electric distribution systems. Projects located in these “strategic zones” are eligible for a premium above their competitive bid.

Beyond the Blueprint, there’s plenty of other solar action happening throughout the state. The New York Public Service Commission is working to ensure that foundational policies like net metering will keep New York homes and businesses going solar. New York’s net metering program is a critical component of the state’s growing solar economy. Like roll-over minutes on a cell phone bill, net metering ensures that solar customers get fair credit for the clean energy they deliver to the grid for others to use. But continued access to this key solar program isn’t certain: for each utility service territory, the New York’s net metering statute establishes a minimum threshold for total development of net metering capacity, equal to 1% of each utility’s peak electrical demand in 2005.

Recognizing the importance of the state’s net metering policy, the PSC has taken up consideration of this policy. Prompted in large part Central Hudson Gas and Electric’s suspension and recent reopening of their net metering program by Commission order, the Commission will be reviewing the net metering limitations of the other major utilities to make sure net metering limitations don’t frustrate solar adoption resulting from the NY-Sun and RPS programs.

And finally, the Long Island Power Authority has also been busy of late. In addition to doubling down on its solar Feed-In Tariff (see here for original 50 MW offering) and expanding its Solar Pioneer rebate program for residential and small commercial systems, the LIPA Board has announced that it will provide Solar Pioneer rebates to projects that use the solar leasing model.

There’s no question that New York perceives great promise in a solar energy future and that the state has been very calculated in its decisions to create this reality. With solar energy becoming increasingly cost-effective each day, 2013 will mark an important milestone for establishing the proper foundations on which New York’s solar economy will be built.

In the meantime, our thoughts and sympathies go out to our families, friends and colleagues who are drying out, cleaning up and rebuilding in the wake of the hurricane. There are brighter times ahead.

Original Article on The Vote Solar Initiative

What We Can Learn from Germany’s Solar Dominance

Solar has never been more affordable for more Americans – with residential prices dropping an impressive 14% over the last year alone. But global solar leader Germany is still beating the U.S. in the race to low-cost PV.

The Lawrence Berkeley Lab released a fascinating study that shows that the total the price of a residential installation in Germany is $2.8/W – or a whopping 45% – lower than here in the U.S. Um, that’s huge.  (Note that cost varies dramatically in the U.S. from state to state, and even within a state.  So in some places U.S. solar installers are actually on par with German pricing, but on average we are lagging far behind.)

So what’s going on? We’re all buying the same panels at prices generally set by the global market? Turns out there are a multitude of reasons for the price differential – many of which carry clear lessons for effective policy design.

1. Size matters. Turns out that the sheer number of megawatts a country has installed dramatically affects the price of solar – and Germany has installed massively more solar than we have. In 2011, Germany installed about five times more solar than the U.S (7,485 MW compared to 1,900 MW).  At the residential scale, Germany installed more than 2.5 times more solar in 2011 than the U.S. So why is more solar lower cost solar? LBNL attributes this to business process “learning” – with experience, businesses become more efficient at every step from customer acquisition to installation.  Our learning rate is slower because simply haven’t had as much practice developing solar projects. LBNL estimates that about half of the price difference could be attributed to this factor alone.

The policy lesson is simple; more solar. Market-building policies that drive economies of scale and sustained industry experience deliver real returns in the form of cost-effective solar.

2. Little soft costs add up to big price tags. To put it simply, while German installers pay the same price for solar panels -where price is determined on a global scale- they are paying much less for all the ‘soft costs’ associated with a solar installation.  In Germany their customer acquisition costs are lower; their permitting costs are lower; they pay lower sales tax on solar systems, and their solar companies may be making smaller margins on each installation. The lesson here is that both the U.S. solar industry and solar advocates have a role to play in reducing these soft costs. While the industry must reduce customer acquisition and overhead costs, groups like Vote Solar can help work to reduce permitting costs and sales tax costs. Check out our Project Permit campaign website to see what we are doing to streamline solar permitting requirements in the U.S.

3. A national approach to energy policy helps. While all U.S. solar installers have access to the 30% federal investment tax credit, additional state or even local incentives vary widely and create a very uneven landscape for solar installers to navigate. Germany on the other hand has offered one federal incentive – the feed in tariff (FIT).  In addition to offering the cost advantages of a straightforward incentive process, the FIT has been reduced iteratively since 2004 – putting pressure on German installers to lower system prices to maintain attractive investments for their customers. (Note that California’s CSI rebate program has had a similarly effective step-down design that has reduced the incentive from $2.50/watt in 2007 to near zero today) We aren’t expecting federal solar energy policy to overtake the work of the states anytime soon, but this is a good reminder that a patchwork 50 state approach is an inefficient process.

 

Original Article on The Vote Solar Initiative