Archive for October, 2010

Yesterday’s New York Times reported that Chinese high-performance computing researchers have achieved a performance of 2.5 petaflops using their Tianhe-1A supercomputer. The Tianhe-1A machine is now the world’s most powerful computer, 40% faster than the fastest American machine located at Oak Ridge National Laboratory.

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Yesterday, Secretary Salazar joined Gov. Arnold Schwarzenegger to celebrate the groundbreaking of the Ivanpah Solar Electric Generating System, an innovative "power tower" project in San Bernardino County, California. Located in Southern California’s Mojave Desert, Ivanpah will use solar “power tower” technology to produce up to 370 megawatts of clean, renewable energy for up to 277,500 homes and is expected to generate 1,000 new jobs at the peak of construction.

The project, which is supported in part by a $1.37 billion conditional commitment for a loan guarantee from the Department of Energy, consists of three solar thermal power units that use pivoting mirror fields to focus solar energy on power tower receivers near the center of each array which are filled with water. This concentrated heat causes the solar boilers to produce steam, which in turn drives a turbine which generates electricity for the transmission grid.

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Take the total solar thermal energy capacity in the U.S. – now imagine being able to double that with a single solar farm. That’s the impact that the Blythe Solar Power Project is projected to have upon completion. Announced by the Department of the Interior on Monday, this solar installation will span 7,025 acres of public lands and produce up to 1,000 megawatts of solar power, producing enough to power 300,000 – 750,000 homes.

The massive project will generate over 1,000 construction jobs, before requiring 295 permanent staff to maintain the solar thermal plant. The Blythe site will be the first of four solar thermal plant developments that will eventually produce 2,800 megawatts of electricity, powering up to two million homes in the region.

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California is the undisputed titan in the solar power market. No other state in the U.S. has more solar capacity than California by a wide margin. While the total grid-connected photovoltaic capacity installed in California increased only by 7% from 2008 over 2009, California ranked first in the U.S. in installed solar capacity with 212 MW in 2009 claiming 49% of the national market. While California’s market share for annual installations slipped below 50%, solar markets are still growing strongly in California, they are just growing much faster in other states that have just begun to introduce state solar incentives. In addition, California led the nation in 2009 for installed solar power per person with 20.8 megawatts, a capacity that is almost five times the national average.

So why has California solar power taken off so much more than other states? Yes, the state has a great deal of sunshine and land but so do many other states such as Arizona and New Mexico. Bottom line, the solar market grew in California for the same reason that it grows elsewhere: state sponsored financial incentives and those incentives are incredibly strong in California.

California Renewable Energy Goals

In 2006, the California Public Utilities Commission (CPUC) and the California Energy Commission started the Go Solar California! campaign with the goal of encouraging Californians to install 3,000 megawatts of solar energy systems on homes and businesses by the end of 2016.  Pursuant to this campaign, the CPUC created the California Solar Initiative (CSI) to provide more than $2.167 billion in incentives over a 10-year period to state utilities to help promote the adoption of solar energy. The program’s objective is for investor-owned utilities – Pacific Gas and Electric (PG&E), Southern California Edison (SCE), San Diego Gas & Electric (SDG&E) – to provide 1,940 megawatts (MW) of solar capacity to California homes and businesses by 2017.  In addition, CPUC created the New Solar Homes Partnership (NSHP), which provides approximately $400 million in financial incentives and other support to homebuilders, encouraging the construction of new, energy efficient solar homes with an aggregate solar capacity of 360 MW.

On top of all of this, in November of 2008, California Governor Arnold Schwarzenegger signed California Executive Order S-14-08 which requires “all retail sellers of electricity [to] serve 33 percent of their load with renewable energy by 2020.” Now California energy providers must diversify their energy production portfolio to include renewable energy, particularly solar power.

California Solar Initiative – How the Rebate System Works

So how does the California rebate system work and how can it help California residential consumers install solar power on their homes?  First, you must be a customer of a utility company that participates in the CSI program. While PG&E, SCE and SDG&E are the biggest participants, the CSI was expanded in 2006 to include small municipal utilities. Second, for residential and commercial solar energy systems less than 30 kWh, the CSI program offers an Expected Performance Based Buydown, or EPBB, where the applicant receives the entire incentive payment at the time the system is installed, and the payment is based on expected electrical output of the system. To figure out what your EPBB payment is per watt, you need to determine what step you are qualified. For example, under PG&E, non-residential customers are currently a step 8 and residential customers are a step 7 which means that the EPBB payment per watt is $0.35 and $0.65 respectively. You’ll notice that the EPBB payments decline by step which is due to the fact that the amount of money available under the CSI is finite and lessens as more and more people access CSI for their own solar project.

For larger solar installations (greater than 30kW), the CSI offers Performance-Based Incentives (PBI). Unlike the EPBB, with a PBI rebate, the applicant receives a portion of the incentive payment every month over a period of five years and the payment is based on the actual metered output of the system. Typically, only large scale businesses or commercial systems benefit from a PBI rebate although the EPBB payment and the PBI payment are intended to be financially equivalent.

To see how California’s solar incentives might work for a residential solar power system, please see the chart below:

Please note that there many different ways to finance the purchase of a residential solar system so that you do not have to come up with a large cash outlay at one time yet ensure that you are still spending less than your current electric bill even with financing. Your solar installer should be able to help you with any financing mechanisms.

Additional California Solar Incentives

On top of the state subsidy, the entire state of California has a net metering policy which means that you only pay for the net amount of electricity that you use. With net metering, homeowners with solar installed are able to “bank” the excess electricity their solar system generates and receive credit up to 100% of their electric use bill at the full retail electricity price that they can use later. In addition, California’s government has even gone so far as to exempt the value of a renewable energy source from a property owner’s property taxes. Unlike other home improvements, you do not have to pay increased property taxes even though the value of your home will increase with a solar electric system.

Conclusion

Through a legislative mandate, massive government subsidy and key financial mechanisms, California represents the pinnacle of solar power adoption for residents and businesses alike. Despite California’s tremendous support of solar, there are many potential consumers that are still wary about installing solar…whether its concern over how to finance a solar project, how to find a reliable solar installer, or what to expect throughout the installation process, consumers have lots of questions that keeps them out of the market. For these interested consumers – homeowners and commercial business owners – that are unsure about solar power and how they should go about evaluating whether solar is right for their situation, please know that there are answers to your problems and all you need to do is a little research at great sites like the U.S. Department of Energy, Solar Energy Industries Association, and MyEnergySolution.com. Remember, solar power is potentially a large investment, so it’s advisable to look into both the technical and financial considerations before either getting the wrong solar panel system or dismissing the chance to save with solar.