A report on the Solar Energy Forum by Carl Siegrist, Renewable Energy Strategist, https://twitter.com/CarlSiegrist:
We had a very lively discussion during the Solar Energy Forum at the 9th Annual Green Energy Summit in Milwaukee on March 7. The topic was Solar Energy Opportunities: Transitioning to a Mature Solar Market. The exchange of ideas ranged from the expected – the challenges of dwindling incentives – to the controversial – the looming trade war with China over solar “dumping.”
As the moderator, I was pleased to have Nick Hylla (MREA), Mark Wilkerson (Helios Solar Works), and Matt Neumann (SunVest Solar) on the panel and to be able to fill in for the 4th panelist, Jeff Vercauteren (Cullen Weston Pines & Bach) who could not be there. Although there was not a total consensus on all issues, I did hear some patterns emerge.
1) Chinese solar manufacturers are flooding the U.S. market products, which allegedly are being sold at below cost. This has resulted in lower cost modules and helped installers sell more projects but at the expense of domestic manufacturing. This is an extraordinarily complicated issue and a group of U.S. manufacturers formed the Coalition for American Solar Manufacturing, which filed petitions with the U.S. Department of Commerce and the International Trade Commission charging illegal “dumping” of crystalline silicon solar cells into the U.S. market (see http://bit.ly/ABT2Nn). We should expect to hear more about the outcomes later this spring.
2) The installed price of solar PV has come down dramatically over the past year. A variety of incentives and credits from utilities, Focus on Energy, and the federal government (Investment Tax Credit or ITC) originally helped drive the market and lower costs in Wisconsin but many incentives have disappeared. The ITC is scheduled to end in 2016. No one – manufacturer, installer, or consumer – should ever assume that incentives are stable. There was agreement that ultimately ending incentives for solar – and all energy sources – would be desirable. And there was acknowledgement that solar incentives won’t be what they used to be. Costs reductions in the future will have to come primarily from balance of system costs that include installation labor, inverters, racking, permitting, and interconnection, as well as continued efficiency in both module output and scaling of manufacturing.
3) Although selling solar PV on the basis of “payback” or return on investment is still important, and looking to price parity with retail electric rates is desirable, the true attributes of solar – energy independence and a cleaner environment – need to be better explained to potential customers. Few people try to calculate “payback” before the purchase of a granite counter top, a new car or a smart phone.
4) Passage of a 3rd party solar ownership policy in Wisconsin might be possible in the next state legislative session and some bipartisan support on this is likely. It makes little sense for government or regulators to intrude into a decision on contractual arrangements between a property owner and the supplier of solar power on private property, i.e. whether one owns or leases the solar equipment or buys the power from a 3rd party owning the equipment on the customer’s property for their own use.
If you missed attending the Solar Energy Forum, the presentations should eventually be available from a link at http://greenenergysummit.us. Even if you view them through this link, you will have missed the majority of information: the questions, answers and conversation. So plan to attend next year’s forum.Read Full Post | Make a Comment ( None so far )
From a story by Liz Welter in the Wisconsin Rapids Tribune:
Local businesses making gains in renewable energy might be damaged seriously if the Focus on Energy incentives for customer-sited renewable energy systems aren’t reinstated.
Several central Wisconsin-area business owners have appealed to the state Public Service Commission to restore full funding for the renewable energy program that reduces the cost of solar, wind and biomass installations for utility customers.
“We have seen a definite downturn in sales as a result” of the suspension by Focus on Energy on renewable energy incentives, said Josh Stolzenburg, founder and co-owner of North Wind Renewable Energy LLC, based in Stevens Point.
North Wind Renewable Energy designs, sells and installs solar electric and solar thermal systems for homes, businesses and farms throughout central Wisconsin.
The Focus incentives to install renewable energy systems ended in 2011 when the dollars committed to renewable resources projects surpassed the amount budgeted for incentives, said Kristin Ruesch, PSC communications director. Focus on Energy was created in 2001 to help homeowners and businesses reduce energy costs. The PSC is the state’s oversight body for program.
Through a $29,000 Focus incentive in 2010, James Jozwiak of Marshfield was able to partially fund a solar electricity system to power his fledgling Spencer-based business. A $53,000 federal grant combined with a bank loan completed the funding for a $115,000 solar system, which generates a maximum of 20 kilowatts of power.
“Without the Focus incentive and the grant, my (solar-energy system) installation costs would have been prohibitive,” Jozwiak said about his renewable energy system, which was purchased from and installed by North Wind Renewable Energy. It powers the facility where Jozwiak makes a product called Black Magic, which is a soil enhancer and fertilizer made from earthworm castings.
“Incentives are important, as they allow more people such as myself to install renewable energy systems,” he said.
Read the open letter appeal to the Public Service Commission and see the 150+ people and organizations who signed it.Read Full Post | Make a Comment ( None so far )
An analysis by Don Wichert, Director, Renewable Energy Services,
Wisconsin Energy Conservation Corporation (WECC):
My recent (simplified) levelized cost analysis for commercial PV, at $5,252 a kW installed in WI, over 25 years and with a 5% loan (no shading, no maintenance, no output degradation), is 13.8 cents per kWh as shown on the slide below. This includes a 56% reduction in the installed price due to the ITC and depreciation. With the previously available $600 a kW Focus base incentive, the levelized cost drops to 11.5 cents per kWh.Read Full Post | Make a Comment ( None so far )
A news release issued by Arch Electric:
Arch Electric recently installed and commissioned a 19.32-kilowatt solar electric (PV) system for First Congregational Church, UCC in the City of Sheboygan.
The solar array consists of 84 solar modules and was installed on the roof of the church building with a custom-designed ballast rack system that required only 1 roof penetration into the building.
On an annual basis the Solar PV System will produce over 24,000 kilowatt hours of electricity and save the church more than $2,800.
The solar panel manufacturer has a facility in Georgia, the racking system was designed and manufactured in Southeast Wisconsin, and the NABCEP Certified installers from Arch Electric are local residents. Based in Plymouth, WI, Arch Electric is a leading designer and installer of renewable energy throughout the Midwest, having commissioned over 2-Megawatts of renewable energy on businesses, homes, churches, farms, YMCA’s and other organizations.
Arch Electric also installed a solar electric system at St. Nicholas Senior Apartments in Sheboygan.Read Full Post | Make a Comment ( None so far )
From an article by Tom Content in the Milwaukee Journal Sentinel:
A group of Wisconsin cities and nonprofit organizations was awarded $467,188 on Thursday to help develop ways to remove red tape with the goal of bringing down the cost for homeowners and businesses to add solar power.
The funding from the U.S. Department of Energy was part of $12 million awarded nationwide to 22 different projects.
“We’re making it quicker, easier and cheaper for Americans to go solar,” said Energy Secretary Steven Chu during a conference call with reporters about the Solar Rooftop Challenge. “This is about eliminating some of the hassle and costs of installing solar.”
A maze of local permitting requirements can add $2,500 to the price of a solar system on average nationwide, according to an analysis by the solar installation firm SunRun Inc.
The program is part of a series of initiatives launched by the Energy Department, called the SunShot Initiative, that aim to bring down the cost of solar so that it’s competitive with other forms of energy, without subsidies, by the end of the decade.
The Wisconsin team receiving the award includes the Midwest Renewable Energy Association of Custer, the cities of Milwaukee, Madison and Marshfield, as well as Madison Solar Consulting, Renew Wisconsin and the Wisconsin Solar Energy Industries Association.Read Full Post | Make a Comment ( None so far )
From an article by in the La Crosse Tribune:
When the sun shines, Al Schultz makes money. Specifically, the 32 photovoltaic panels on his roof turn the sun’s rays into electricity that powers his home in Ebner Coulee. If he doesn’t need the power, he sells it to Xcel Energy.
“There is a certain peace of mind,” said the self-employed contractor. “It’s kind of a nice thought to think all your power is paid for.”
Schultz is one of a small but growing number of area homeowners who’ve taken advantage of new, cheaper solar technology, which coupled with state and federal incentives have brought residential solar electric systems within reach of more regular folks looking to lessen their dependence on fossil fuels, lower their utility bills and even make some money.
But changes on the horizon have cast a shadow over the solar industry’s future in Wisconsin. . . .
“Right now it’s out of reach for 90 percent of the home-owning population,” said Michael Vickerman, executive director of RENEW Wisconsin, a nonprofit that promotes economically and environmentally sustainable energy in Wisconsin. . . .
Money from Focus on Energy is still available this year, but rebates will be frozen in January as FOE implements new formulas used to evaluate cost effectiveness and rebalances its portfolio of energy savings and renewables.
Program administrator William Haas said next year’s renewable incentives won’t be decided until early spring.
Solar advocates like Vickerman say the energy policy hierarchy, which values efficiency – use reduction – over renewables in terms of cost effectiveness, is misguided.
“However much efficiency is injected, it doesn’t have any change in the resource mix,” he said. “Diversifying resource mix has value.”
Solar panels may reduce dependence on fossil fuels, but dollar for dollar, Haas said, high-efficiency lighting delivers better savings.
Dearing points out that his customers have already weatherized and bought high-efficiency appliances.
“Our customers call us after they’ve done the low-hanging fruit,” he said. “We’re expensive. This is big dollar stuff. This is the future.”
Vickerman says the future of the solar industry depends on policy.
“If we proceed without any policy changes there won’t be much happening,” he said. “You’ll see a number of solar installers go out of business.”Read Full Post | Make a Comment ( None so far )
An e-mail exchange between Burke O’Neal (Full Spectrum Solar), Robert Norcross (Public Service Commission of Wisconsin – PSC), and Niels Wolter (Madison Solar Consulting) illustrates the agency’s institutional bias against renewable energy in Wisconsin’s Focus on Energy program.
Excerpts from O’Neal’s e-mail (Harming WI Industry: Poor Handling of Focus on Energy Renewables Program) to the PSC and Governor Walker:
Full Spectrum Solar employs seventeen people directly in good paying construction jobs in WI. Many more are employed indirectly as subcontractors and in manufacturing and distribution of the products we use. We are very concerned about the handling of the renewable energy program by the Shaw Group. Nearly all the Focus on Energy incentives for renewable energy systems require that they be installed by the end of this calendar year, but there is no indication whether there will be any renewable energy programs at all next year. In fact, the Shaw Group has not even selected subcontractors to administer this program next year! This uncertainty, along with the normal year-end rush to secure federal tax credits, is creating a massive push to get systems installed by the end of this year. This is requiring installers to hire additional employees and take on additional vehicles and tools, without any assurance of future work. If there is no Focus renewable program at the beginning of next year, but a possibility of a future program, every potential customer will put their work on hold. It is hard to imagine a funding approach that would be more destructive to the renewable energy industry in Wisconsin than what seems to be getting set up by Focus on Energy.
Excerpts from the response of Robert Norcross, Administrator, Gas and Electric Division at the PSC:
The Commission appreciates hearing your perspective on the Focus on Energy renewable programs. While I understand your concerns, changes to the renewable programs are necessary to ensure their sustainability in the long run. Administrative rules require that the portfolio of Focus on Energy programs achieve a cost-benefit ratio of at least 1.0, based on the Total Resource Cost test. With the exception of biomass, no renewable resource measure meets this criteria. In the past, inclusion of non-cost-effective renewable resources was deemed appropriate as the goal of Focus on Energy was to assist in building the renewable infrastructure. Previously, this has not greatly affected the cost-effectiveness of the overall portfolio of programs because renewable projects were a fairly small component of Focus on Energy. However, in 2011 there was a significant increase in renewable projects approved. This resulted in about twice the entire 2011 renewable budget being committed by mid-year. It also put the entire Focus on Energy program in jeopardy of not being cost-effective.
Niels Wolter then offered his analysis of the PSC’s reliance on the Total Resource Cost test and the resulting consequences:
The TRC test is not from the customer’s perspective. It does not include a solar electric system owner’s federal tax benefits, nor does it consider their electric bill reductions. Rather it considers the system from a broader societal perspective. That means that the value of the generation is what it costs a utility to generate the power and meet demand (marginal cost). So what was an economically viable system for a customer may become non viable from the TRC perspective.
Read more about the TRC test here (starting on page 6-5).
Interestingly given how these cost tests work, reducing the Focus on Energy incentive level, does not improve the solar electric program’s benefit cost ratio. If the Focus program has a given amount of incentive funds and demand for incentives outstrips supply, then reducing the incentive per kW would result in more people installing systems, and the Focus program’s portfolio (all the technologies they support) benefit cost ratio would be further reduced. In other words, the reduced incentive would result in more people making the non economic decision (based on the TRCt test) of installing a solar electric system, and pull down the TRC of the entire Focus program. So reducing incentive levels is not a solution to this issue… strangely raising the incentive levels would. But that’s not going to happen.
The TRC tests seems to be an alternative reality that no one lives in… and strange things can happen there.Read Full Post | Make a Comment ( None so far )
From an article by Tom Content in the Milwaukee Journal Sentinel:
The solar sector is expanding nationwide, a new report out Monday found, but a renewable energy advocate warned that Wisconsin could see a pullback in solar projects and growth next year.
“Our report shows that there are over 100,000 solar jobs at over 17,000 employment sites nationwide, and despite an extremely sluggish economy, the solar industry is creating jobs nearly 10 times faster than everyone else,” said Andrea Luecke, executive director of The Solar Foundation in Washington, D.C., and former director of the Milwaukee Shines program.
The solar industry’s job growth has been 6.8% over the past year, at a time when the economy was growing by less than 1%.
The solar jobs census also found that solar employers expect to increase the number of solar workers by 24%, representing nearly 24,000 net new jobs by August 2012. Over the next 12 months, nearly half of solar firms expect to add jobs.
Milwaukee is seeing job growth from solar components manufacturing – including the panel factory Helios USA, which opened this year, and the Ingeteam factory that will soon being producing solar inverters.
But the picture for installations isn’t as bright for next year in Wisconsin, despite incentive programs launched in Milwaukee and Madison. There is a flurry of activity this year, but 2012 activity could “fall off the cliff,” said Michael Vickerman, executive director of Renew Wisconsin.
Setbacks for solar projects include the suspension of funding incentives for nonresidential solar by the Focus on Energy program, as well as the cancellation of a program by We Energies that provided incentives for renewable projects.
“There are still a few projects in the pipeline and the second half of this year will be a good one for the industry and installation contractors – as long as they don’t pay any attention to the cliff, the abyss, that’s in store for them this January,” Vickerman said.Read Full Post | Make a Comment ( 1 so far )
From the North Woods to the Illinois border, from Lake Michigan to the Mississippi River, growing numbers of Wisconsin factories, businesses, schools, hospitals, fire stations, apartment buildings and breweries have installed systems that heat their water with the power of the sun.
A newly launched online map on RENEW Wisconsin’s web site displays the locations of more than 60 nonresidential solar hot water systems installed in the state. Each flagged system is accompanied by a box containing information on the owner, installation contractor, system size and date of installation. Many of these systems are linked to their installers’ web sites, accompanied by photos.
The solar hot water map joins the family of on-line renewable energy maps developed by RENEW Wisconsin in the past year. Some maps are resource-specific; others break out renewable energy systems by county.
“These maps verify the enormously positive effect that Wisconsin’s clean energy initiatives like Focus on Energy have had in creating such a vibrant economic sector,” said RENEW executive director Michael Vickerman.
Created in 1999 and strengthened in 2006, Focus on Energy is a ratepayer-funded initiative that helps Wisconsin residents and businesses employ energy efficiency measures and install renewable energy systems.
“In the past five years, Focus on Energy incentives have been instrumental in putting solar hot water on the map in Wisconsin,” Vickerman said. “No other Midwestern state has come close to experiencing Wisconsin’s success in advancing this particular application of solar energy.”
The table below shows the five largest solar hot water installations operating in Wisconsin, two are located at University of Wisconsin campuses.
Installer: H&H Solar, Green Sky Energetics
Capacity: 6,800 square feet (total)
Year installed: 2010, 2011
Terrytown Plumbing/H&H Solar
Menomonie Indian Tribe
Hooper Corp./ Pertzborn Plumbing
Avis Rent-a-Car (multiple locations)
Mitchell’s Heating & Cooling
Milwaukee-based Hot Water Products, one of the largest stocking distributors for solar thermal and domestic hot water systems in the Midwest, supplied and designed four of these systems and many others in Wisconsin over the last five years. In addition to training contractors in this field, Hot Water Products also assists them with system design and equipment sizing support.
This year, installation activity has been brisk, but most installation contractors are bracing for a sharp slowdown in 2012, due to a Focus on Energy decision on July 1st to suspend renewable energy grants and incentives to nonresidential customers. The announcement of the funding suspension came after the Legislature voted in June to lop $20 million from Focus on Energy’s 2012 budget.
“The longer Focus on Energy’s funding suspension goes on, the deeper the damage will be. Installers are holding their breath as they wait for Focus on Energy to restore renewable energy funding assistance.”
Installers and system owners wishing to add their installations to the map should contact Alex Brasch at firstname.lastname@example.org.Read Full Post | Make a Comment ( None so far )
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