Get Ready, Utilities: Solar Is Coming

by John Farrell, via Renewable Energy World

Quick question.  Your state has good sunshine, lots of open rooftops, and the cost of solar energy has been falling by 10% per year.  Do you think it will take 13 years to double the 10 megawatts (MW) of installed solar power?

Yes, if you’re the largest corporate utility in my state, and willfully ignoring the economic trend.  But ‘no’ if you make decisions based on data, because the price of unsubsidized solar electricity will undercut most utility retail electricity prices within a decade, enabling 200 times more solar (4,400 MW) than found in this utility’s plans.

That’s just one utility’s wake up call in a new report from the Institute for Local Self-Reliance (ILSR), Commercial Rooftop Revolution, and it’s far from the only one.  By 2016, over 100,000 MW of unsubsidized rooftop solar will able to match grid electricity on price.  Within 10 years, it will be 300,000 MW, enough to provide 10% of the nation’s electricity.  This affordable solar future presents a stark challenge to traditional utility planning and a clarion call for better electricity policy.

Some utilities have responded by clinging to the 20th century paradigm of centralized control.  Virginia’s Dominion Power, for example, expressed satisfaction at a recent conference at introducing standby charges on solar producers, ostensibly to help them recover the cost of “backing up” solar power.

On the other hand, many utilities and state regulatory commissions are finding the value in solar and realizing that perceived barriers aren’t as large as they had feared.  Austin Energy, a Texas municipal utility, now pays a non-subsidy premium for solar because it helps them offset expensive peak power purchases.  In Hawaii, utilities who two years ago argued that the distribution grid was at its limit have been managing to accommodate thousands more solar projects on their grid systems.

Regardless of their predisposition toward solar power, utilities, regulators, and policy makers need to recognize that there’s a revolution in electricity systems coming soon.  Solar will become so affordable in the next 5-10 years that as many as 38 million homes and businesses will elect to produce their own power more cheaply from unsubsidized solar rather than buy it from their utility.  That means policies that limit distributed generation will have to change: net metering limits must rise, permitting must be simplified, archaic “15% rules” will have to be driven by data not speculation.

Ultimately, as one Hawaii public utility commissioner has said, the paradigm for the electricity system will flip. Utilities will need to transition from being inflexible to being flexible.  They’ll switch from primarily running slow-response coal and nuclear power plants to finding the right mix of flexible natural gas or energy storage systems that can partner with low-cost wind and solar and advanced demand response to supply reliable electricity.

The forthcoming revolution in solar power promises more change in the next 10 years than utilities have faced in the last 100.  And they had best get ready.

John Farrell directs the Energy Self-Reliant States and Communities program at ILSR and he focuses on energy policy developments that best expand the benefits of local ownership and dispersed generation of renewable energy. This piece was originally published at Renewable Energy World and was reprinted with permission.

7 Responses to Get Ready, Utilities: Solar Is Coming

  1. John McCormick says:

    This all great news about the potential for installation. Now, lets get serious and talk about battery storage, without which, the sunset on rooftop solar of Walmart or some assembly plant, warehouse or factory means the potential goes to zero.

    We need some very authoritative discussions and now about battery technology, costs, maintenance, shelf life, chemicals involved, disposal and recycling potential…the whole nine yards.

    It is so easy to see the numbers on the map and believe we are on the verge of a solar revolution…while the sun shines. Cloudy days, nights, heavy snow pack on the panels are all a part –and the vital parts– of this revolution.

    Maybe we are on the verge of a battery revolution. I hope we are. We’ll need that.

    Comments? We need input here.

  2. Mike Byron says:

    My house in suburban Oceanside CA has been continuously off grid for 235 days as of today. We have 3.7 KW solar augmented with 1KW wind. Battery storage capacity is 33 KW. This is provided by using 24 T-105 deep cycle lead acid batteries. The nominal life of these is five years. Old batteries called “cores” are simply returned to the dealer for recyclingm Each returned battery is worth a discount of about $50.00 towards purchase of a replacement battery.

  3. wili says:

    We should be on the verge of realizing that we can live happy, fulfilling lives with less that a quarter of our current energy use. And that we can adjust our lives to getting most of our energy when the sun shines or the wind blows.

    We can do all of this ‘demand management’ immediately. It does not depend on any technical breakthrough. Just a recognition of the gravity of the situation and something vaguely approaching an appropriate response to that reality.

  4. J Bowers says:

    Be aware that lots of clear days and sunshine isn’t vital. Solar panels in the UK have been found to fulfill 98% of manufacturer specs. Our weather helps distribute photons more evenly, reducing the need for panels to be angled towards the sun.

  5. Mike Byron says:

    Today was grey and entirely sunless. Yet still, we took in just under six kilowatts from our solar panels. Not much wind so far today either alas, however, we’ve still managed about 400 watts there too. As I’ge noted above, we are now 235 days completely off grid.

  6. I read your article and comments and fully agree with all. But with Mississippi being led by ‘BIG OIL’, there is no way in hatie that our politicians will allow green energy, solar energy, wind energy, and allow its residents on the grid and sell excess energy. Not in my lifetime, I am sorry to say!

  7. Dick Lawrence says:

    @Mike Byron
    Mike, in both your comments you have a number (33KW, six kilowatts) expressed in units of power (Kw) when what you intended to show is energy (Kwh). The storage capacity of your batteries is represented in Kwh – energy, not power. The amount of energy captured by your solar panels or your wind turbine similarly should be Kwh, unless you’re describing the average or peak power seen that day.
    Sorry to nit-pick but the distinction in important.
    – Dick Lawrence