An Introduction to Community Solar and Solar Gardens

Transcription

1 An Introduction to Community Solar and Solar Gardens - A Concept Taking Hold - February 2013 i

2 2013 An Introduction to Community Solar and Solar Gardens The Efficient Solar Market Partners of Northern California The Solar Sonoma County RoofTop Challenge Team Powered by SunShot February 28, 2013 ii

3 An Introduction to Community Solar and Solar Gardens The Efficient Solar Market Partners of Northern California Partnership This material is based upon work supported by the U.S. Department of Energy under Award Number DE-EE of the SunShot Program. This work is prepared by the Efficient Solar Market Partners of Northern California RoofTop Challenge Team. Questions? Contact: Alison Healy Executive Director Solar Sonoma County David McFeely Director Grants & Industry Solutions SolarTech First Publication February 28, 2013 iii

4 Prepared By: Solar Sonoma County Team: Efficient Solar Market Partners of Northern California Solar Sonoma County 1300 Valley House Dr. North, #100-5 Rohnert Park, CA (707) Author.Peter Renfro, PAR Consulting Prepared For: U.S. Department of Energy SunShot Initiative Rooftop Solar Challenge This material is based upon work supported by the U.S. Department of Energy under Award Number DE-EE DISCLAIMER This report was prepared as an account of work sponsored by an agency of the United States Government. Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof. iv

5 Preface The U.S. Department of Energy SunShot Initiative Rooftop Solar Challenge provides incentives to regional awardees to address the differing and expensive permitting, zoning, metering, and connection processes required to finance and install residential and commercial solar systems. The 22 diverse Rooftop Solar Challenge teams bring together city, county, and state officials, regulatory entities, private industry, universities, local utilities, and other regional stakeholders to clear a path for rapid expansion of the use of solar energy and serve as models for other communities across the nation. Teams will implement step-by-step actions with the goal of cutting red tape to make it faster, easier, and less expensive for Americans to go solar. Teams are streamlining permit processes, updating planning and zoning codes, improving standards for connecting solar power to the electric grid, and increasing access to financing. The Rooftop Solar Challenge is part of the SunShot Initiative, which strives to make solar energy cost-competitive with other forms of energy by the end of the decade, and part of the Department s larger effort to position the United States as a global leader in the rapidlygrowing solar market. For more information visit Acknowledgements Solar Sonoma County would like to thank our industry advisors and participants: Peter Renfro Consultant, Erin Lannon Solar Sonoma County. v

6 Table of Contents I. Introduction... 1 II. What is a Solar Garden?... 2 III. How Do Solar Gardens Work?... 2 IV. Subscribers... 2 V. Where Are Solar Gardens Built?... 2 VI. Who Builds and Owns Solar Gardens?... 3 VII. Pros... 3 VIII. Cons... 3 IX. Where California Stands on Solar Gardens... 4 X. Examples of Solar Gardens in the U.S SMUD SolarShares - Sacramento, CA... 5 Brewster Community Solar Garden - Brewster, MA... 5 San Miguel Power Association Community Solar Array - Paradox Valley, CO... 6 Sol Partners Cooperative Solar Farm - Brighton, CO... 6 XI. Final Notes... 7 XII. Resources... 8 vi

7 I. Introduction Individuals and communities throughout Sonoma County, and indeed globally, are looking to utilize the power of the sun to provide an alternative to conventional energy sources, thereby reducing their electrical cost and the overall environmental impact. Solar photovoltaic (PV) arrays allow residents and businesses to capture and convert the sun s energy to usable electricity, but not all individuals and businesses are able to take advantage of this valuable and readily available solar resource. A 2008 study concluded 75% of American households are unsuitable for purchasing or leasing a solar PV system. Likewise, many businesses that could take advantage of solar energy are also disqualified. Reasons for disqualification or unsuitability include, but aren t restricted to: Businesses, families, or individuals who rent o Landlord or property owner cooperation and participation required o Solar PV is an unmovable fixture of the property o Unsuitable metering or electrical system configuration Unsuitable space for the PV array o Insufficient area o Unsuitable orientation to the sun o Insufficient sunlight (shading) Unsuitable structures or properties o Lack of usable, available attachment point or mounting structure o Roof retrofit required prior to attaching PV array o Unusable ground area o Unable to secure building permit Economics o amount of electricity used doesn t justify expense o financing unavailable These situations, many of them seemingly insurmountable, create obstacles to wellintentioned energy users interested in pursuing solar PV. However, solutions for many of the above issues are emerging. Community Solar, or Solar Gardens, provide just such a solution. The terms Community Solar and Solar Garden are interchangeable. For ease of reading, this report will use the term Solar Garden. 1

8 II. What is a Solar Garden? A Solar Garden is a solar PV array that is shared by a community of individuals and/or businesses that are connected to the same local utility provider. Solar Gardens range in power produced from tens of kilowatts up to 2 megawatts (2 million watts) or higher. A Solar Garden broadens the pool of eligible participants to include those who would otherwise be excluded by one or more of the circumstances mentioned above. Thus, the goal of the solar garden concept is to provide access to clean, local energy for its participants who otherwise would not be able to develop or access solar energy. Ultimately this expanded access to solar energy reduces dependence on power produced by non-renewable sources such as coal, natural gas, or petroleum products, which contribute substantially to greenhouse gas emissions and the advancement of climate change. III. How do Solar Gardens Work? Essentially, participating members buy their own plot of, or interest in, a solar PV array. Solar Garden interests are can be issued in 1 kilowatt (1000 watts) shares, or by purchasing one or more solar panels in a solar array. Each share produces a measurable amount of electricity. They then receive a credit on their electricity bill for the power generated by their share. The utility pays a fixed amount for the electricity generated by the solar PV array. For example, in Colorado, participants receive about 6.8 cents per kilowatthour produced. IV. Subscribers A special category of owner, or shareholder, is sometimes called a subscriber. A subscriber is an on-grid, partial owner of the solar garden, who receives energy from the photovoltaic array. An anchor subscriber is someone who owns a large portion of the solar garden, generally over 40% in the case of Colorado, and sells subscriptions to new participants and buys them in the event that the resident moves. A subscriber organization is at its core the company whose purpose is to maintain the solar garden and its subscriptions. The exact definition will vary depending on the state. The subscription generally runs for 20 years and can indeed be sold in the event that the subscriber moves out of the area. V. Where are Solar Gardens Built? A solar garden developer typically provides the expertise, equipment, services, and location to install a solar array which will then be connected to the utility grid. The solar garden array can be hosted on a school, church, public building or on a privately owned building or land. Good candidate locations include a brownfield site (land previously used for industrial or commercial purposes) or unproductive/retired farmland. The size of the pv array and access to the local grid are key determinants of the host site. 2

9 VI. Who Builds and Owns the Solar Garden? The solar pv arrays are built and maintained by a third party solar garden contractor/developer with no costs born by the program participants or their respective utilities. Also, maintenance and operation funds are held in a third party managed fund, not by participating members or their respective utility. Though keep in mind every state s legislation on community solar gardens is unique to the state. There are various avenues for which solar gardens can be financed for construction. One innovative method of financing, crowd funding, involves calling upon small investments from community members to pool their resources to pay for their subscriptions. The second, power-purchase agreements (PPA), utilizes a third party financier to pay for the initial investment, thus enabling subscribers to save money immediately without being burdened by up-front costs. VII. Pros Solar Gardens provide an opportunity to utilize solar-generated electricity for the estimated 75% of Americans households which are unsuitable for solar installations. Solar Gardens promote local job creation for the construction of the arrays and maintenance/upkeep for the decades-long lifespan. Solar Gardens convert otherwise unproductive or wasted land or roof spaces into productive renewable-energy resources. Solar Gardens could be a very important element in the process of gradually replacing power generated from fossil fuels and ultimately cut greenhouse gas emissions, which contribute to climate change. Whereas large utility-scale solar arrays require large parcels of land, distributed solar gardens can be much more versatile in their development, size, and location. VIII. Cons Solar gardens are largely a new development in the marketplace of renewable energy. The legislative and regulatory foundations have yet to be laid in most states in the U.S. Solar Gardens are still tied to the main utility power grid, making the subscribers vulnerable to disruptions in power supply in the event of transmission failures from weather storms, power plant failures, power line damage, and so on and so forth. 3

10 IX. Where California stands on Solar Gardens The California State Legislature has attempted to pass community solar legislation (Community-Based Renewable Energy Self-Generation Program, SB 843, Wolk) which would establish the rules and criteria for solar gardens in all areas where service is provided by existing utilities SCE, PG&E, and SDG&E. The bill failed passage in the Assembly Committee on Utilities and Commerce, and proponents of the measure argue the reason being due to intense, late-session lobbying by Pacific Gas and Electric (PG&E) and Southern California Edison (SCE). A modified SB 843 was re-introduced in December 2012 and is currently under review in the Senate Rules Committee. Advocates of SB 843 claim the following benefits: Allows an electricity customer the option to own solar generation in a shared facility at a lower cost than using their own roof. Can be built on degraded or idle land near preferred distribution points. Creates local jobs. Depends entirely on economics and does not require any state subsidies, incentives, or rebates. Provides a framework that benefits electricity customers, utilities, and, on a broader level, California s economy in general. Helps California meet its goal of 33 percent renewable power by Provides a method for achieving the California's long-term goal of zero netenergy buildings. 4

11 X. Solar Garden Examples in the U.S. SMUD SolarShares Sacramento, CA Sacramento Municipal Utility District (SMUD) offers customer participation in a pilot project called SolarShares, a 1 MW solar array installed by a 3rd-party vendor. Under a long-term power purchase agreement (PPA), SMUD resells the electricity generated (an estimated 1,736,402 kwh/year) to participating customers at a price lower than the PPA price. The customer pays a fixed monthly fee and receives a credit for the electricity produced on their bill. The size of the customer s system and monthly fee is determined by their annual electricity consumption for the previous 12 months. The 1 MW system reached the desired subscription of 95% of output was reached in 6 months, primarily fulfilled by word-of-mouth and media stories, not by paid market advertising. By charging SolarShares customers slightly more than grid price, the utility provider is able to have a subset of customers (those of SolarShares) defray the higher costs associated with PV relative to other renewables, thus preventing associated costs from being burdened by the majority of ratepayers. Sacramento Municipal Utilities District (SMUD) SolarShares Sacramento, CA Brewster Community Solar Garden Cape Cod, MA This solar garden was enabled by Massachusetts legislation called the Green Communities Act of 2008 that provide for innovative approaches to developing renewable energy. This legislation empowers individuals and businesses to participate in the benefits of renewable energy. In 2009, the concept for the Brewster Community Solar Garden Project was born. The facility site lease was acquired through a process involving a town meeting vote, a request for proposal, and a successful response and negotiation with the Town of Brewster. The project went live on Feb 13, Brewster Community Solar Garden Cooperative, Inc. - Brewster, MA 5

12 San Miguel Power Association Community Solar Array Paradox Valley, CO The San Miguel Power Association partnered with Clean Energy Collective of Carbondale Colorado to create SMPA Community Solar. SMPA Community Solar offers the sale of a solar panel (or multiple panels) to individuals or businesses. Each panel costs $705 and will produce up to $45 per year, which will be credited on the customer s electric bill. San Miguel Power Association (SMPA) Community Solar webpage: Clean Energy Collective (CEC) SMPA Community Solar website: Sol Partners Cooperative Solar Farm Brighton, CO This relatively small (10 kw) project is designed to expand with the addition of new customers. The system is owned by United Power, a rural electric co-op in the northern front-range area of Colorado. Customers can license individual solar panels and are credited the amount their panel(s) produce against their regular electric bill. The rate they are reimbursed is slightly higher than the regular retail rate. United Power charges $1050 to license one 210-watt solar panel and estimates one panel will provide a 3% return, or approximately $32 per year. This system went live in Sol Partners Cooperative Solar Farm Brighton, CO 6

13 XI. Final Notes The Solar Garden concept is catching on as a solution to the problem of providing renewable energy benefits to individuals and businesses who, for a variety of reasons, are not able to install renewable-energy generation facilities on or near their usage-point. Once established, Solar Gardens could make renewable energy available to every grid-connected consumer of electricity. The economic and environmental benefits of the additional solar pv capacity that could be installed to support Solar Gardens is significant. That said, there are still many regulatory and legislative hurdles to overcome, as well as grid management issues to resolve, before Solar Gardens begin to penetrate the overall development of renewable energy. Progress has been made in establishing a variety of types of Solar Gardens in Massachusetts, Colorado, California, Pennsylvania, Oregon, and many other states. There is a growing volume of information on the history, background, and current development of Solar Gardens in this country. Please explore the resources provided on the following page. 7

14 XII. Resources U.S. Department of Energy Community Solar Guide Northwest Community Energy - Community Solar Webpage Clean Energy Collective - Homepage Solar Garden Institute Homepage with Map of U.S. Solar Garden Locations Solar Garden Institute Solar Gardens Headquarters 4800 W. 80th Ave Suite 260 Westminster, CO info@solargardens.org 8