SRP caps solar system size, limits renewables budget

The Salt River Project decided yesterday to cap the size of residential rooftop systems eligible for its rebate to 5 kws, limit the amount allowed for any commercial solar rebate and cap the per watt solar rooftop incentive to $2.70 per watt. http://www.azcentral.com/business/articles/2009/04/21/20090421biz-solarcuts0422.html. While I have never been an advocate of keeping the per watt incentive high forever, I think what SRP has done is premature, and demonstrates an unfortunate lack of seriousness when it comes to rooftop solar in Arizona and renewables in general. In every category of renewable energy, the Project is vastly underspending the state's other utilities, which are regulated by the Corporation Commission and must comply with the Commission's Renewable Energy Standard. The problem here is that SRP isn't just a little irrigation ditch company anymore -- it's one of the largest utilities in the state, and by ratcheting back its solar program, SRP is sending the wrong signal to the rest of the country at precisely the time Arizona is trying to brand itself as the solar energy capitol of the country. It also creates a disparity between utility customers in Phoenix: if you happen to live in Arizona Public Service's territory, you will receive a growing number of solar options, and if you take electricity from SRP, a lesser amount of renewable energy. Over time, as Congress considers and probably passes a cap and trade program, this will also mean that SRP customers, who will be more exposed to coal-fired electricity, will pay higher prices. SRP should rethink this decision, or find some other way to show it's committed to building a solar energy future for Arizona.

Solar CEOs voice cautious optimism about investor interest

Solar titans at yesterday's Greentech Media Conference in Scottsdale voiced cautious optimism about investor interest in solar companies. Lyndon Rive, the founder and CEO of Solar City, which leases solar systems to homeowners and businesses and has a significant presence in Arizona, noted there is still a lot of interest among venture capital investors in solar companies, especially those that have a strong management team. Rive said those companies will receive money from the markets, though perhaps not as much and not as quickly as last year. Peter Green, the CEO of New Mexico-based Advent Solar said he's seen a "freeing up" of private equity financing for solar companies the past four to six weeks, and that investors are largely looking for renewable energy companies that demonstrate breakthroughs in technology, over companies that are purely providing new capacity. (Green cited the fact that some capacity is now shutting down in China). Rive sounded warnings about the need to continue to break down barriers to adoption of solar, which focus around the up-front costs associated with putting solar on rooftops, and the aesthetics of the panels. Green, who announced a new partnership with Arizona State University yesterday, as well, http://www.azcentral.com/business/articles/2009/04/16/20090416biz-advent0416.html, called on states like Arizona to seize the opportunity it has to fashion itself as a "center of expertise in solar." According to Green, the states that demonstrate an ability to drive down costs will attract capital and businesses, but the chance to do so is fleeting. "It's about lowering cost and it needs to be developed here (in Arizona) and it is perishable."

States nudge home builders to go solar

I can't recall the precise number of times I've been asked by an Arizona constituent why we don't do a better job of getting home builders to put solar on rooftops when they are building the homes, rather than ex post facto, but it is a lot. It always seemed like a good idea to me, and a few years ago I convened several home builders in my office to figure out how to encourage builders to get on board with solar from the get-go. A few niche-market home builders in Arizona are making solar an option just like granite counterparts, but for the most part, it's still up to homeowners in Arizona to put up the panels. Now, several states are moving to require builders to make their housing stock solar friendly. http://www.usatoday.com/money/industries/energy/2009-04-06-solar-ready_N.htm. In New Jersey, home builders of more than 25 houses will have to offer solar and discuss it as an option with prospective buyers under a bill being considered by the Legislature there; Colorado is mulling legislation that would require builders to pre-wire homes for solar and inform buyers they can roll the cost of a solar system into the price of the mortgage; in Hawaii, all new homes will have to come outfitted with a solar water heater beginning in 2010; and in New Mexico, the Governor just signed a bill that sets up renewable energy districts to help home buyers finance solar systems. Arizona legislators have sponsored a slew of their own solar-related bills, which await action after the state addresses the budget crisis. http://www.azcapitoltimes.com/story.cfm?id=10801.

Renewables rising...

The latest figures from the U.S. Energy Information Administration (EIA) show that the ascendancy of renewable energy is becoming more real by the month. According to EIA, the amount of all forms of renewable energy produced in the United States increased by 5.9 percent in 2008. Non-hydro renewables such as wind and solar fared the best, with solar enjoying a 36.1 percent jump and wind energy increasing by an impressive 51 percent. http://www.eia.doe.gov/cneaf/electricity/epm/epm_sum.html. What does it all mean? Primarily that renewables are just beginning to establish a foothold in the energy marketplace, and the increasingly expensive natural gas and coal-fired electricity -- which aren't going away -- are going to have some company in utility portfolios. Still, non-hydro renewables (solar, wind, biomass, biogas, geothermal) only make up about 3 percent of the nation's total energy production, so there is a long way to go before we have a balanced energy supply in the United States.