Last Week Solar Policy Review
Thursday, 23 December 2010 12:03
Policy developments have been popping like spent light bulbs as 2010 draws to a close. Here are details on four major announcements from the past week that are sure to impact solar and renewable energy:
Federal
1) On Friday, Dec. 17, Obama signed a one-year extension of the United States Tax Grant Program (TGP), also known as the cash-grant or Treasury Section 1603 program. A key driver for solar in the U.S. in 2010, the grant was initiated in 2009 to provide a direct payment rather than a tax credit for renewable energy projects. The program's impact so far:
a. As of Nov. 22, $416 million in grants had gone to 1,179 solar projects worth nearly $1.4 billion in 42 states.
b. In 2009, the U.S. installed about 435 megawatts of solar. That doubled to about 1,000 megawatts in 2010. Many forecasts indicate 2011 should see as much as 2,000 megawatts installed.
2) A day earlier, on Dec. 16, the Department of Energy and the Department of the Interior jointly announced a proposal to create 22 million acres in "Solar Energy Zones," public land in six Western states that is considered suitable for utility-scale energy production.
a. Under the proposal, the Bureau of Land Management would designate open lands where the permitting process streamlined to encourage utilities to build solar projects there. The BLM would seek to strike a balance between high solar energy potential and low environmental or resource concerns.
b. Eight utility-scale solar projects totaling 3,572 megawatts have been approved in the last three months through the Department's 'fast-track initiative' for BLM lands in California and Nevada.
c. The BLM's current solar energy caseload includes 104 active solar applications covering 1 million acres that developers estimate could generate 60,000 megawatts of electricity.
State
1) On Thursday, Dec. 16, the California Public Utilities Commission passed the state's first feed-in tariff, called the Renewable Auction Mechanism (RAM). The program requires California's three largest investor-owned utilities to purchase electricity up to one gigawatt of power from solar and other renewable sources with an output of 20 megawatts or less.
a. Purchases are to be made during biannual competitive auctions that award contracts based on cost competitiveness and project viability.
b. The program is designed to help the utilities meet their Renewable Portfolio Standards (RPS) and is intended to help offset the loss of the state's $149 million Solar Initiative fund, which is nearly out of money after providing incentives to just half the capacity it was intended to spur.
2) Also on Thursday, the California Air Resources Board (CARB) voted to approve the basic fundamentals of the cap and trade system that will implement the state’s landmark 2006 Global Warming Solutions Act (AB 32).
a. Emissions from 360 companies that emit more than 25,000 tons of greenhouse gases annually will be capped under the first phase of the program beginning in 2012. That phase includes utilities, large industrial companies, cement companies and fuel refiners.
b. In 2015, the program will be expanded to include the natural gas and transportation sectors.
c. Businesses that exceed the cap in a given year must reduce emissions or buy credits or allowances to offset emissions above the cap.
SolarTech will be researching and assessing the impact that these policies will have on job creation in California. The data will assist in development of the SolarTech Workforce Industry Collaborative, or SWIC, and will help partners better understand the types of training and educational programs required to meet next year’s staffing needs.
More reasons to celebrate the strong prospects for solar in 2011. Happy Holidays!
Fabienne Rodet
Senior Analyst, SolarTech