In California, aggressive energy goals encourage utilities to build, own rooftop solar power

Most utilities purchase solar power from other companies. But a massive new Southern California Edison project is proving that it can be lucrative for the utility to own the power itself.
Written by Andrew Nusca, Contributor

Most utilities in the United States that use solar power purchase it from other companies. But a new Southern California Edison plant is the largest such project in the U.S. in which the utility owns the power itself.

The rooftop project -- which consists of some 33,700 photovoltaic panels installed on almost 600,000 square feet of space on a warehouse in Fontana, Calif. -- provides two megawatts of energy, enough to serve 1,300 area homes.

USA Today reports:

The electricity travels under a parking lot to an existing power line on the street.

It took Edison two months to get the project permitted and two to get it built. Solar farms in California's desert can take years to get permits and to be built. Edison told state regulators that it anticipated paying building owners $20,000 per megawatt per year for rent, or about $20,000 per year for about 250,000 square feet of roof space.

I don't have to use green land, and it's a lot faster," says Mark Nelson, who heads the project for Edison.

Utilities in other states (Arizona, New Jersey, New Mexico, North Carolina) have attempted similar programs, but none as large as the one in California, which serves the top solar market in the nation.

Part of the motivation behind the project is the state of California's aggressive targets for renewable energy such as solar and wind power: the state's utilities must get 33 percent of their energy from renewable sources by 2020, according to Gov. Arnold Schwarzenegger.

A few more takeaways from the article:

  • Utilities have the funds to build big installations.
  • Since they're making use of already-used land, the systems don't consume "green" land or require new power-transmission links.
  • With fewer hurdles, rooftop solar projects may get faster approval.
  • The new commodity in a solar economy: roof space. Rising rents are coming.
  • New roofs are preferred, because solar panels have a 20-year lifespan.
  • Solar photovoltaic power remains the most expensive renewable source.

The question is whether photovoltaic power, versus solar thermal, is best at this scale.

Solar thermal used to be a better value. But with panel pricing dropping 40 percent in a year's time, federal tax credits increasing and extending and technology improving, photovoltatic may now have the upper hand.

This post was originally published on Smartplanet.com

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