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Nov 21, 2024

Utility-scale Clean Energy -- A Threat to Distributed Generation?

February 14, 2017

Category: News

 

Duke Energy, one of the nations largest electric power holding companies, recently acquired a solar portfolio from SunPower Corp. The purchase includes the 15 megawatt (MW) Wildwood Solar II array, and the 20 MW Rio Bravo I and 20 MW Rio Bravo II systems, all located in Kern County, California.

The three acquisitions neighbor two pre-existing Duke Energy solar sites, and bring the total of the companys solar holdings to 181 MW in California alone, and 2,900 MW overall solar capacity within its 52,000 MW portfolio.

 

Duke Energy has also appeared in the news for entirely different reasons. In 2015, Duke plead guilty to nine violations of the nation's Clean Water Act, after having polluted four major rivers for several years with emissions from five North Carolina power plants. The issue became public in 2014, when the company dumped 39,000 tons of coal ash and 27 million gallons of ashen slurry into the Dan River; the plume, a thick sludge, extended for 70 miles. The company was also found to be the largest contributor to U.S. greenhouse gas emissions, according to a 2016 Greenhouse 100 Polluters Index compiled by UMass Amhersts Political Economy Research Institute. Adopting greener contributions to their generation portfolio has the added benefit of acting as a counterweight to a long history of negative press.

Angling Towards the Sun (and Other Sources of Renewable Power)

Duke Energy isnt the only electricity producer adopting cleaner means, as coal becomes increasingly unpopular due to public awareness of health and environmental concerns, government regulations, and the plunging profitability of using the fossil fuel. The lifetime cost for renewable means of energy-- such as solar, or wind-- have also sunk exponentially, rendering coal and nuclear relatively unwise investments; some estimates put clean generation on par with natural gas, given the bolstering green energy tax subsidies and favorable political environment.

Relying upon a means of electricity generation without a tangible input source like gas or coal also insulates utilities and power producers from price shocks. As reserves of feasible fossil fuel sources fluctuate in response to new technologies and dwindling resources, the price of electricity varies wildly. Solar energy generation necessitates only an upfront cost to purchase equipment and perhaps maintenance. With the rise of energy efficient technologies, energy producers are finding that retail sales of energy have dipped substantially.

Utility-scale solar investments can vary in design, from concentrated solar power (CSP) installments to concentrated photovoltaic discs to fields of simple solar panels. Many utility companies also have the capital to invest in experimental energy storage technology, to guarantee the accessibility of solar power at nights or during periods of inclement weather.

œSolar growth is so extensive and has so much momentum behind it that were at the point where you cant put the genie back in the bottle, stated Jeffrey R.S. Brownson, a Pennsylvania State University professor who specializes in solar adoption. œYou either learn how to work with this new medium, solar energy, or youre going to face increasing conflicts.

 Tilting the Scales in Their Favor

While utility companies and energy producers continue to expand their own solar projects, they have also joined conversations related to the national and state governments promotion of smaller-scale solar. In addition to a national tax credit, the solar industry and individual owners of solar panels are supported by a system known as net metering. Net metering allows solar panel owners to effectively sell their excess energy back to the grid, and is currently a greatly contested issue on the state-level.

A great deal of Americas surge in solar energy has originated from simple arrays belonging to homeowners and businesses, who often adopt them as a means to drive down their electricity bill. This distributed generation of energy has become such a sizable disruption to the status quo that many utilities have advocated with politicians to slow or halt the extension of easily available, public solar benefits. In many states, utility companies are legally permitted to operate as monopolists, and have continued uninterrupted since the formative eras of the United States.

In states such as Indiana, many legislators grapple with opposition and outside groups and industries to design municipal policy for distributed generation. Indiana state Senator Brandt Hershman ( R) recently proposed a bill that would drive down the rate of net metering reimbursement, and all but eliminate solar benefits for customers in state in the next five years.

According to state campaign records, Hershman has received $9,000 since 2010 from Duke Energy alone. In Indiana, the energy company and its attached political committees bequeathed $76,000 in the last three years to state Senate members, both Republicans and Democrats alike.

Net metering allows for independent solar customers to gradually have their system œpay for itself before the end of its lifetime.

While attempting to downplay independent ownership of solar panels, many utilities propose an alternative known as œcommunity solar, which would allow a group of customers to lease or rent panels on utility-own arrays.

Utility companies interest in the matter also has implications for the burgeoning solar industry. As in nearly every other state, Indiana has witnessed the materialization, seemingly out of thin air, of its regional solar workforce. According to the U.S. Department of Energy, employment under the solar industry has grown 125% in the last seven years, outpacing coal employment and annually contributing more new positions than oil, natural gas, and coal industries combined.

Many who oppose Hershmans bill in Indiana fear its potential implications for the progress of clean energy, and local employment, as it gives large utility companies that capacity to push small solar businesses out of the market. However, the opposition of the bill includes more than 1,500 people who work in the solar value chain in Indiana, a surprising reality given the states relatively harsh natural and policy environment for solar. While the states bill is being presented, the solar industry is prepared to fight the bill and prove that distributed solar is here to stay, even without policy support.

 

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