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Wednesday, April 1, 2009

Solar power needs fund boost to be viable

From a column by Dave Skoloda in the Coulee News:

We’ve been warming our house with the sun using passive solar design for 25 years. Now we’re ready to take the next step, either with solar panels for electricity or solar water heating. So the story in The New York Times about a surge of interest in a new payment system for solar electric was of great interest.

The Times reported that one of the reasons Germany and other European nations are much further ahead of the United States in adopting solar power is the financing technique. In Germany, for example, a homeowner with a rooftop solar system might receive a payment for excess electricity that is fed back into the grid four times that of electricity generated at a coal-fired power plant.

As the Times reported, this makes the electrical consumer rather than the taxpayer responsible for the subsidy for green energy.

Gainesville, Fla., has become the first U.S. city to adopt such a policy. California is considering it and bills to adopt it have been introduced in Washington and Oregon as well.

According to the Gainesville Regional Utilities Web site, the utility had received enough applications to meet the 4-megatwatt program caps for 2009 and 2010. The fixed rate for the 20-year life of the contract starts at 32 cents per kilowatt hour or 26 cents depending on size and application of the installation and decreases over time. For comparison, the average retail electric rate in Wisconsin was 11.69 cents per kilowatt hour, according to the February report of the Energy Information Agency.

A spokesperson for the Gainesville utility said in a telephone interview that the program had attracted mainly businesses (36 for ‘09 and 20 for ‘10) that benefit from the depreciation; residential properties are more likely to choose an upfront rebate on an installation, she said.

The solar program will generate less than 10 percent of the utility’s total needs, she added.

Xcel Energy, which supplies electric power here, gives its Colorado customers an incentive for installing solar panels, but the program called “Solar Rewards” is not available in Wisconsin.

David Donovan, regulatory policy manager for Xcel’s Wisconsin and Michigan district, said that the Colorado program was in response to state mandates. Xcel has an experimental feed-in-tariff program for renewable energy in Wisconsin but it was not sized appropriately for solar and it doesn’t have the subsidy of the Gainesville program. The company is reviewing the policy, he said.

Other solar incentives are offered in Wisconsin under the Focus on Energy program, but not the long-term incentive pricing contract offered in Gainesville.

Still, it’s a start on capturing the potential for solar power.

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