SOLAR:

Harvesting the sun for electricity still needs a jolt in many areas

Despite the mounting inaugural hoopla in Washington, D.C., over a president-elect who is an avowed champion of renewable energy, this town is no San Francisco, nor even a Chicago, when it comes to using solar energy. Anya Schoolman, a resident of Washington's historic Mount Pleasant neighborhood, found that out the hard way.

Schoolman, along with a neighbor and each of their sons, began the Mount Pleasant Solar Cooperative with the idea that their entire neighborhood -- with long rows of flat-roofed, mixed-income homes -- could go solar and save residents a few bucks.

Little did she know that, two years later, she would still be struggling to navigate the layers of incentives and rebates that she hoped would make paying for the panels cheaper, on a monthly basis, than a typical electric bill.

Going solar is still difficult to do affordably in many areas of the country, even as states like Colorado and New Jersey adopt measures to ease the way. "In California, it's pretty simple to go solar," Schoolman said. She said that in her D.C. neighborhood, forming the co-op was necessary to provide "a service for cutting through the red tape."

More and more states are implementing renewable portfolio standards that mandate that a percentage of electricity come from renewable sources. But convincing utilities to buy small-scale, consumer-generated energy, instead of from their usual wholesale markets, has been slow going.

"They begin with denial, and then there's a little anger there that happens. They gradually move to acceptance," said Adam Browning, director of the Vote Solar Initiative, which focuses on bringing solar to the mainstream.

Vote Solar works nationally to advocate reasonable standards to connect small systems to the electric grid and to put net metering rules in place. For example, in one state his group is fighting a requirement that residents install a cellular device that monitors variables like wind speed before they can hook up their panels.

"Unless you set up a standardized, transparent, non-arbitrary process, utilities can and will screw you," Browning asserted.

Before installing solar panels, she had to install a procedure

Schoolman's experience reflects the broad spectrum of barriers still faced by homeowners who want to adopt solar. In legislation passed by the Council of the District of Columbia last year, she led a campaign to incorporate measures that would make their renewable energy credits (RECs) actually worth some money.

Their first agenda item was an effort -- which eventually succeeded -- to include a solar "carve-out" in the bill. This required that a small overall percentage of electricity come specifically from solar projects, the one form of renewable energy that is easily generated from inside the grid of a densely populated city and during times of peak demand.

Schoolman also worked to increase the fine that the utility must pay if it does not meet the overall renewable portfolio requirements. She explained that the existing fine was very low, which effectively set a ceiling on the value of renewable energy because the utility could pay the fee instead.

"We want them to play, not pay," said Schoolman. These practical matters that would make solar more affordable, she said, were very different from the top-level carbon budget issues that several larger nonprofits had focused on in the bill.

In the end, with the 30 percent federal tax credit, a new city rebate of $3 per watt, and a bulk buying discount to purchase the panels, the 2.3-kilowatt systems the group plans to install on each roof could cost somewhere around $10,000, less than half of what they would otherwise cost.

Still, there are no electrons flowing on anyone's roof yet, although about 65 people have formally signed up. Next up for the co-op is navigating the confusion of actually applying for the new city rebate and getting power provider Pepco to recognize their RECs. In the city, there is no existing procedure for certifying the RECs of such small-scale systems. Schoolman hopes to have panels installed by mid-2009.

Despite its troubles, the co-op is paving the way for more solar in the District of Columbia, and several other neighborhood groups are interested in following suit. "It's as easy to do for 50 houses as it is for one," she said, noting that the regulatory barriers only need to be toppled once.

A reluctance to deal with small-scale energy producers

While the solar co-op's issues are local, they illustrate some of the challenges that need to be addressed before residential solar can catch on.

"I do think we are seeing signs across the United States that states and local communities are looking at the barriers that are specific to their region," said Neal Lurie, communications director for the American Solar Energy Society.

"The winning of a major piece of solar policy really marks the beginning of the effort," said the Vote Solar Initiative's Browning. It takes a while to work out the kinks, he said, pointing out that New Jersey's solar program has gone through "87 million" revisions.

Solar carve-out provisions are on the rise, and today, Browning estimates, there are seven or eight states that have them. But even these provisions can backfire against small-scale projects. In North Carolina, one utility, reluctant to buy from the consumer market, wants to meet the solar provision by building a generation project itself -- a far more expensive proposition for the public.

The key, said Browning, is opening up the renewable energy markets to smaller-scale producers.

Chris Graves, business development director for Switch Inc., the renewable energy company that the Mount Pleasant Solar Cooperative intends to use, agreed. The utilities want all the RECs to come to them in bulk, he explained.

Businesses that package RECs together for the utility to purchase often don't want to deal with the small amounts that houses provide, he said.

Activists and specialized companies help neighbors plug in

One key to taking residential solar projects mainstream may be to have the community tackle the complexity and cost together, like Schoolman is working to do. She at first faced a hard time convincing a contractor to offer a bulk discount until she found Graves, who was quick to see the economies of scale in the project.

If Schoolman lived in California, she wouldn't have these difficulties. There, several companies have sprung up that market discounts in a community depending on how many people sign up. Also, in California, a new model is being developed that allows public-private "community choice aggregators" to act as utilities that contract their own electricity as they see fit.

And while Schoolman takes pride in her co-op members' grassroots work to physically own their solar panels, one California co-op has had success used a different model, allowing power companies to own the panels that are installed on its members' property. The Downtown San Jose Solar Project recently worked to install 36 solar systems in San Jose, Calif.

Marni Kamzan, who spearheaded the community group and wrote detailed proposal requests, said that contractors were "falling all over themselves" to get the job. The one that most of the 36 households eventually decided to go with was SunRun Inc., which along with a few other companies is pioneering a new way for homeowners to go solar.

"I never really wanted to own solar panels," said Kamzan. "What I wanted was to derive my electricity that I used from solar production."

SunRun provided that by signing a power purchase agreement with Kamzan and her neighbors, a practice that is common for larger projects but new to homes. The company sells the panels at a sharply reduced price and maintains ownership of the electricity. Now, Kamzan is buying electricity from SunRun at a low, fixed rate that has substantially reduced her electric bill. The company, in return, takes full responsibility for maintaining and insuring the panels and guarantees power production for 20 years.

Whether in California or Washington, D.C., and whether the process takes months or years, community projects to adopt solar energy will be on the rise, said Lurie. And the city of Berkeley, Calif., recently pioneered a provision that finances residential solar through a city bond and incorporates the payback into a homeowner's property taxes.

But perhaps the key ingredient will be people like Schoolman and Kamzan who organize their neighbors. Kamzan is now eager to advise other communities and companies: "I am a solar champion," she said.