The Germans have proposed significant revisions to their landmark renewable energy policy, the feed-in tariff, and the proposed prices should make Americans wonder why solar still costs so much on this side of the Atlantic. After a significant step-down in March, German utilities will be buying rooftop solar on long-term contracts from projects 10 kilowatts… Continue reading
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Updated 2/1/12 because I underestimated how the tiered pricing worked. Thanks to bkarney at Renewable Energy World for the comment. Last week I wrote about the time-of-use pricing scheme that PG&E offers in San Francisco, and how solar power is worth 14% more compared to a standard flat-rate electricity plan. In reality, it’s 36% or… Continue reading
I just came across an interesting interview that radio host Diane Rehm did with Jeremy Rifkin, author of The Third Industrial Revolution. The excerpts below lay out his vision for an energy future that is decentralized and democratized. (He also notes that this vision has just emerged in the past two to four years, but we’ve been around since 1974…).
The book is organized around five pillars of the third industrial revolution:
Pillar one, renewable energy. Pillar two, your buildings become your own power plants. Pillar three, you have to store it with hydrogen. And then Pillar four…the internet communication revolution completely merges with new distributing energies to create a nervous system…Pillar five is electric plug-in transport…
when distributed Internet communication starts to organize distributed energies, we have a very powerful third industrial revolution that could change everything…
You can find some renewable energy in every square inch of the world. So how do we collect them? … If renewable energies are found in every square inch of the world in some frequency or proportion, why would we only collect them in a few central points? …
[it] jump starts the European economy, that’s the idea. Millions and millions and millions of jobs. Thousands of small and medium-sized enterprises have to convert 190 million buildings to power plants over the next 40 years…
That’s the vision: a decentralized energy system can be democratized with local ownership, spreading the production of energy and the economic benefits as widely as the renewable energy resource itself.
In recent weeks, I wrote a Solar Grid Parity 101 and published an animated map of the year when major U.S. metro areas will reach solar grid parity. The most frequent criticism was “you didn’t include tax incentives!”
Yes, there is a 30% federal tax credit on the table until 2016 (barring Republican control of Congress and the White House) and it makes a substantial difference. Mouse over the following map to see the impact of the federal Investment Tax Credit on solar grid parity in 2016.
My one thought: if the ITC expires as scheduled, the 2017 map will have a lot more red than the 2016 one if we measure grid parity with incentives.
But you’ve seen the difference (from 3 states to 21 states with grid parity!), now vote in the comments:
Should the tax credit be included in a calculation of grid parity? Why or why not?
Solar grid parity is considered the tipping point for solar power, when installing solar power will cost less than buying electricity from the grid. It’s also a tipping point in the electricity system, when millions of Americans can choose energy production and self-reliance over dependence on their electric utility. But this simple concept conceals a… Continue reading
Where does solar grid parity strike first? How fast does it spread? Click “animate” on the map below to see which major metropolitan areas can beat grid prices with local solar first, and how quickly unsubsidized solar could take over America’s major metropolitan areas.
In January, I plotted the size of state solar markets against their average installed cost and found surprisingly little correlation. When Lawrence Berkeley Labs put out their 2011 version of Tracking the Sun (IV), it was possible to update the chart, which I did in two stages. The first chart simply overlays the 2010 average… Continue reading
Clean energy advocates should cast aside their worries about increasing Republican scrutiny of energy subsidies. The clean energy industry’s foolish reliance on tax incentives has already handcuffed its expansion. Unlike the leading nations in the clean energy race, the United States has no coherent energy policy. Rather, its energy market is balkanized by 50 distinct… Continue reading
You don’t have to be big to go big on solar power. That’s the lesson from the Gainesville Regional Utilities, the electric utility whose feed-in tariff solar policy has brought over 7 megawatts (MW) of solar to the city’s 125,000 residents. The raw number isn’t much, but it puts Gainesville among the world leaders in solar installed per capita, beating out Japan, France, and China (and besting California, with 32 kilowatts -kW- per 1000 residents).
The basic premise behind the feed-in tariff program is that anyone who wants to be a solar power generator can connect to the grid and get a 20-year contract for their power from the municipal utility. The long-term contract makes getting financing for solar projects easier and the prices are attractive. The utility pays 24 cents per kilowatt-hour generated for large-scale ground-mounted systems and up to 32 cents for small, rooftop systems.
The price differentiation helps accommodate solar arrays of various sizes, from residential to larger commercial installations, spreading the economic opportunity. The differentiation may also help small-scale residential projects that can’t use federal tax incentives for businesses (depreciation).
Thus far, approximately one-third of the city’s 7.3 MW of solar power is in relatively small systems, 100 kW and smaller. About half the installed capacity is in projects 500 kW and larger.
The solar feed-in tariff program also brings value to the local community and electricity system. A report released earlier this year found that the grid benefits and social benefits of solar power far outweigh the typical valuation of solar power by utilities. These benefits include reduced stress on the utility distribution system and reduced transmission losses.
The feed-in tariff program also means local economic development. With a rule of thumb of 8 jobs per MW, according to a University of California, Berkeley, study of the jobs created from renewable energy development, Gainesville has already generated 56 jobs. The National Renewable Energy Laboratory has estimated that each megawatt of solar adds $240,000 to the local economy, and if Gainesville’s solar projects are locally owned, the value could be much higher.
More than anything, Gainesville provides an important lesson in local energy self-reliance. While many communities must await action by a state legislature or investor-owned utility, the municipal utility has the authority to act quickly in support of the community. And when the utility is locally controlled, it can mean big things for local solar power.
For more information on feed-in tariffs and their success in supporting solar power, see CLEAN v. SREC: Finding the More Cost-Effective Solar Policy.
This is a presentation by John Farrell to the MDV-SEIA Solar Energy Focus conference in Washington, DC. In it, I discuss the transformation in the electricity system being wrought by clean energy sources, the winning economies of local solar power, how the drawbacks of solar are technically surmountable, and how public policy must change to… Continue reading