Solar energy is booming here in the U.S. and around the world. Solar has clearly turned a corner in recent years, from exotic, expensive and do-goodery, to cost-effective, viable and just plain sensible in many circumstances. Policymakers in California and elsewhere have recognized this sea change in the cost of solar and there are now a number of programs available for landowners to sell solar power to their utility.
This article is a brief primer on how landowners can take advantage of the boom in solar to make money from their property.
The large majority of California has enough solar resources to make solar viable, though some coastal areas are dicey. Assuming that you have a good enough solar resource, here are the key steps in developing solar on your property.
1. Figure out how big a project you can fit
A good rule of thumb is 6 to 8 acres per megawatt. A megawatt of solar provides enough power for about 200 homes and will cost about $3 million today as an “all-in” cost. For ground-mounted wholesale solar projects (which sell power to the utility), you want to focus on projects at least a megawatt or more in order to justify the development costs. Some key programs in California are now focused on projects that are three megawatts and below so I’ll assume for the rest of this article that the project being developed is three megawatts, even though you may want to develop a larger project.
2. Interconnect your project
Interconnection is the first major hurdle for project development. Interconnection means you have permission from the utility to connect and operate your solar project in parallel with the utility grid. They can’t say no to you, by law, but many areas are just too expensive to interconnect viably, so it’s highly important to figure out early on whether your project can be interconnected affordably.
California enjoys a newly viable Fast Track process for interconnecting projects up to five megawatts far faster than under other options. In practice, however, Fast Track is generally only available for projects three megawatts and below.
A very good tool for scoping your project’s interconnection potential at no cost is to look to your utility’s online interconnection maps. PG&E, Southern California Edison and San Diego Gas & Electric all maintain their own interconnection maps. You can find what wires are on your property and what voltage they are from these maps. You can also find out how much capacity is available to interconnect on your property.
You won’t, however, find reliable information on whether your project will pass Fast Track. For that, you should submit a $300 Pre-Application Report to the utility. This new option provides an additional level of detail about your potential project site, above what is available in the interconnection maps. You often can, with some analysis, figure out if your site is likely to qualify for Fast Track.
The only way to be sure you can qualify for Fast Track, however, is to apply for Fast Track and go through the process. And that will cost some money. The application fees are quite low – $800 for initial review and $2,400 for supplemental review – but the real costs come from engineers and consultants who are required to create engineering diagrams and to shepherd the applications through the process. Total costs for obtaining permission to interconnect under Fast Track are usually about $25-35,000.
Even though it’s called Fast Track it can still easily take six months for full interconnection approval and another six months for required upgrades to be constructed.