This NREL map shows the states in the United States where feed in tariff legislation has been passed – only 14 states so far

The National Renewable Energy Laboratory (NREL) has released the largest report on feed in tariffs ever produced by a US Government Agency.

The 144 page document, called A Policymaker’s Guide to Feed-in Tariff Policy Design (PDF Download), analyzes the results of Feed in Tariff legislation in over 75 countries, including the efforts so far in the United States.

What is a Feed in Tariff and Why Should I Care?

A Feed in Tariff (FiT) is an alternative to taxpayer-subsidized incentives for renewable energy programs. With a FiT, the government mandates electric utilities to pay a certain above-market rate for electricity generated by net-producers. Meaning, an individual with a good solar location can install solar panels and turn a profit.

There are a number of reasons that a FiT is more effective than cash and tax incentives towards spurring renewable growth:

• The FiT is a performance based incentive – Quality of system design and performance is determined based on a need for return on investment.
• The FiT does not depend on taxes – Since incentives rely on tax money, at some point those coffers will empty and the incentives run out.  A FiT can be financed many ways, usually in the electric market. This takes a burden off of strapped state and federal budgets, and permits renewable growth to scale.
• The FiT offers a predictable return on investment – Solar energy systems offer a predictable rate of production whose value increases as the cost of electricity increases. Given the state of the economy, a renewable investment can be more secure than the stock market!

Key Findings of the Report

The NREL report does a good job of debunking feed in tariff myths, while also critically examining policy challenges faced abroad. Some of their more interesting findings:

• “FITs are responsible for approximately 75% of global PV and 45% of global wind deployment” (5)
• “The arguments in favor of a FIT policy are primarily economic in nature. These include the ability to … stimulate significant and quantifiable growth of local industry and job creation … [and] only cost money if projects actually operate” (27)
• “RE developers benefit from the long-term stability of the revenue streams generated from electricity sales, which helps foster a high level of investment security.” (121)
• “Another benefit is the direct competition for market share that is occurring under FIT policies in countries such as Germany, France, and Spain. This can drive greater private R&D investment, while helping spur further innovation and technological cost reduction” (121)

The report cites a number of primary, secondary, and tertiary benefits (pg. 18-20) for growing the renewable energy with FiT policies, such as:

• Increasing local jobs and developing the economy
• Reducing greenhouse gases
• Displacing load (to phase out coal fired power plants)
• Peak shaving (i.e. reducing the peak load conditions which CMP cites as the reason for the $1.4 billion grid upgrade)

The report then goes on to discuss in great detail the pros and cons of different models of feed in tariffs and the variety of ways they can be made into policy. Variations include payouts based on fixed rate prices vs. premium rates which fluctuate based on the market, to sliding scale rates based on economic conditions and those that vary based on resource quality and location.

You can read this in-depth report for free. (PDF Download)

Will a Feed In Tariff Make it to Maine (and New Hampshire)?

If you’ve been following our blog for a while, you’ve seen our coverage of Maine’s own attempt to establish feed in tariff, which was voted unanimously “Ought Not To Pass” in May, 2009.

A watered down version of the bill, providing for pilot community-owned electricity generation with caps on tariff payouts, was later passed in June 2009. The Midcoast Green Collaborative has a great write-up of the legislation as well as a history of Maine’s slow road towards a feed-in tariff.

For the moment, no concrete, meaningful feed in tariff legislation for Maine homeowners is on the horizon.

Meanwhile, New Hampshire has just passed legislation that will require utilities to pay customers that are net-generators of electricity for their surplus.

The rates to be paid for this electricity are yet to be determined – whether they are truly market rates or a lesser “avoided costs” rate, but should the legislation be successful in spurring renewable energy growth it is possible that true feed in tariff legislation will follow.

We’ll keep you posted as feed in tariff legislation continues to develop in Northeast!

Special thanks to Clean Technica and Renewable Energy World for information about this new NREL report.

More Reading

Learn more about feed-in-tariffs and how other states and countries are using them to move solar energy forward:

• Hawaii feed-in tariff decision to open clean energy market
• Portugal Gives Itself a Clean-Energy Makeover (NY Times)
• Tripling of Solar Jobs in the UK this Year due to FIT?
• Feed-in tariff for alternative energy

Janet Ward, a friend of ReVision Energy in Concord, New Hampshire, recently alerted us to some questionable legislation making its way through the New Hampshire State Senate.

Bill SB 334, which states that it is “encouraging the installation and use of small scale renewable energy resources by homeowners and businesses,” is coming under fire because it would allow Public Service of New Hampshire (PSNH) to divert $5 million of money that should purchase renewable energy credits for a single solar development project in Manchester.

As reported from the New Hampshire Sustainable Energy Association:

PSNH is asking the New Hampshire House of Representatives for permission to fund a single solar energy project in Manchester with funds it is supposed to use to purchase Renewable Energy Certificates or pay into the State’s Renewable Energy Fund(REF).

The REF funds are intended to be available throughout the State for renewable energy projects to benefit residents, small businesses, and municipalities. The funds are vital to the small businesses which are building New Hampshire’s green economy.

The PSNH project, funded via the RPS program, undermines investment in New Hampshire’s small business future.

The bit of legislation that is causing the controversy:

In lieu of PSNH making payments under RSA 362-F:10 for class II electric renewable energy standard obligations or purchasing certificates, as defined in RSA 362-F:2, III, to comply with RSA 362-F class II electric renewable energy standard obligations, beginning upon the effective date of this act PSNH shall retain such payments and utilize $5,000,000 of such amounts to invest in the development of the solar photovoltaic renewable energy project in Manchester. The amounts retained by PSNH shall be used to amortize the outstanding capital investment for the project. When the nominal payments retained by PSNH equal $5,000,000, PSNH shall return to routine compliance with RSA 362-F:10 for going-forward class II electric renewable energy standard obligations.

What This Means

Under current law, the $5,000,000 would go towards the purchase of Renewable Energy Certificates (the Renewable Portfolio Standard or RPS) or pay into the New Hampshire’s Renewable Energy Fund (REF).

According to The Green Energy Times, “The REF funds are intended to be available throughout the State for renewable energy projects which benefit residents, small businesses, and municipalities. The funds are vital to the small businesses which are building New Hampshire’s green economy.”

In other words, the act would allow PSNH to create their own special project and avoid the current process, which incentivizes small businesses and entrepreneurs to create renewable energy projects, and drives a competitive renewable energy marketplace.

RPS requires New Hampshire to generate 16 percent of new energy from renewable resources such as wind, solar, biomass and hydro by 2025, and Renewable Energy World predicts New Hampshire’s energy will be 22-25% renewable by 2025 should the effort be successful.

Performance requirements for the PSNH project are not defined in the bill, though there is some verbiage in the Bill that suggests that performance of the PSNH project would be subject to review.

Opponents to SB 334 claim that the RPS program has led to regular employment for 126 electricians and solar installers and grants for more than 270 renewable energy projects across New Hampshire. In contrast, they claim that the PSNH project will create only five full jobs a year, “at a cost of $1 million per full-time position.”

What You Can Do

ReVision Energy encourages you to read about the legislation and then take action – there is a great amount of information as well as links to newspaper articles and opinion pieces at http://www.nhsea.org/public-policy.php.

You can contact members of the New Hampshire House Science, Energy and Technology Committee via e-mail: HouseScienceTechnologyandEnergy@leg.state.nh.us or visit the New Hampshire House website for for complete contact information for the Committee.

Most importantly, you can attend the Committee’s Public Hearing on SB 334, which will be held this Thursday, April 15 at 1pm in room 304 of the Legislative Office Building, 33 North State Street, Concord, New Hampshire (map and directions).

A solar power project completed this week in New Hampshire – clean energy is ready to go!

In his first official State of the Union address, President Obama offered a rousing challenge to Congress to get to work on a variety of issues – jobs, security, health care, and the transition to a clean energy economy.

With 2009 behind us, but its challenges far from over, Obama took an approach that was urgent, while at times light-hearted, as he analyzed the country’s problems and his suggestions for implementing change.

We were pleased to see “clean energy” make it into the speech some dozen times, though Obama mentioned “solar panels” only once.

Here’s our take on some of the key points raised during the State of the Union address:

• Obama Lauds Success of Recovery Act
  

  “Because of the steps we took, there are about two million Americans working right now who would otherwise be unemployed. Two hundred thousand work in construction and clean energy”

  Obama put a lot of effort into defending the actions necessary in 2009, both the unpopular bank bailout and the ongoing American Recovery and Reinvestment Act (ARRA), aka the Stimulus.

  While Obama’s focus on clean energy jobs was on the manufacturing side – he mentioned both “the California business that will put a thousand people to work making solar panels” and a need to create “new factories that manufacture clean energy products,” the Stimulus also has had a big positive effect on those who install those panels thanks to financial incentives that were part of ARRA.

• Obama Sees Clean Energy as the Route to Tomorrow
  

  “We can put Americans to work today building the infrastructure of tomorrow … There’s no reason Europe or China should have the fastest trains, or the new factories that manufacture clean energy products… I know that there are those who disagree with the overwhelming scientific evidence on climate change. But here’s the thing — even if you doubt the evidence, providing incentives for energy-efficiency and clean energy are the right thing to do for our future -– because the nation that leads the clean energy economy will be the nation that leads the global economy. And America must be that nation.”

  Obama seemed very cautious about making the environmental case for a switch to a clean energy economy, instead rooting his argument in the need to create very real clean energy jobs.

  While we couldn’t agree more, and laud Obama for finding common ground, it’s a bit disappointing that the very real crisis facing our planet is still a point of argument.

  The reality is that regardless of the state of the economy, we need to make a move to clean energy now as an act of survival.

  That Obama was cautious to acknowledge this threat points to an even greater challenge of worldview we still have to resolve.

• Getting There – Incentives and Innovations
  

  “We should put more Americans to work building clean energy facilities and give rebates to Americans who make their homes more energy-efficient, which supports clean energy jobs. … Next, we need to encourage American innovation. Last year, we made the largest investment in basic research funding in history, an investment that could lead to the world’s cheapest solar cells or treatment that kills cancer cells but leaves healthy ones untouched.”

  Again, Obama mentions investment in research as a major player in the move to a clean economy. While we agree, the reality is that there are plenty of technologies that are already here which are reliable, affordable, and available.

  Both grid-tied photovoltaics and solar hot water are energy investments that make economic and environmental sense.

  We’re eager to see what Obama plans to offer with “rebates to Americans who make their homes more energy-efficient,” and wish we’d heard something about a feed-in tariff.

• The Economy of Old – Nuclear, Oil, and Gas?
  

  “But to create more of these clean energy jobs, we need more production, more efficiency, more incentives. And that means building a new generation of safe, clean nuclear power plants in this country. It means making tough decisions about opening new offshore areas for oil and gas development. It means continued investment in advanced biofuels and clean coal technologies. And, yes, it means passing a comprehensive energy and climate bill with incentives that will finally make clean energy the profitable kind of energy in America.”

  After so much invigorating news from Obama, it was disappointing to hear his last word on energy mention nonrenewable sources of energy.

  While it may be necessary to find some common ground with Republicans to move the overall initiatives forward, we still disagree that more power plants and “clean” coal are the best way to build the nation’s infrastructure.

Disappointments aside, it’s encouraging to see how large a role clean energy fits into Obama’s plans to move the country back into recovery.

As Obama acknowledged, we have some mighty challenges ahead of us, but the technology is here to move to a clean economy.

What is difficult is mustering the will to act.

I recently had the opportunity to meet Senator Susan Collin’s energy policy expert, Amy Carroll. At the meeting was Richard Silkman of GridSolar. There I learned about what GridSolar is up to, and what it’s up against.

GridSolar has submitted an alternative proposal to CMP’s $1.4 billion dollar proposal to increase the transmission corridors in Maine.

Projections show that as demand increases for electricity, Maine will experience brownouts during periods of peak demand over the coming decade. To address this concern, CMP has proposed Bigger Wires to move electricity around the state and avoid problems like brownouts.

These bigger wires would come at a big cost, $1.4 billion on the backs of ratepayers, as well as much wider corridors than today. Perhaps the biggest cost of all is what it is we’re buying into. If we purchase these transmission corridors, we will be compelled to use them. This will result in much less incentive to conserve, to produce our own energy, or to implement smart grid technology.

GridSolar has offered a very interesting alternative. For less money, they’ll ensure that we don’t face rolling brownouts, AND, we’ll get clean, renewable solar electricity out of the deal. Rather than expand transmission facilities, they would install fields of solar electric arrays that would feed into the grid. The beauty of this concept is that maximum solar electricity production roughly matches peak demand (both occur on the sunniest days of the summer), so the solar electricity would not only avoid brownouts, but would also lessen our overall need for fossil fuel electricity.

No one doubts that GridSolar’s plan would result in grid dependability. No one doubts that it’s less expensive. The big challenge with the proposal is that CMP’s proposal would only cost the state 8% of the project total because it would be funded through ISO New England.

While that sounds like a great deal for Mainers, it is a serious problem. True, we only pay 8% of the cost for our transmission upgrades, but we also pay 8% of the cost of Massachusetts’ upgrades. We don’t get to vote on the MA decisions, and MA does not vote on ours. This communist era funding mechanism allows the people who decide to put in transmission capacity to only pay a fraction of the real cost, and it creates a huge incentive to make power lines that no one really needs. As Richard Silkman said; “If every school district were offered 92% funding to put up a Giraffe farm, there would be a Giraffe farm in every district.”

This is crazy. At a time when we need more than ever to invest in renewable energy, conservation, and smart grid technology, the cards are stacked in favor of even bigger wires. Wires that we pay for, ultimately, and that keep us from making the important investments that will keep the lights on AND save the planet. Tell your friends and your elected officials, particularly Snowe and Collins, that we don’t want bigger wires feeding an ever bigger habit, but that now is the time to start weaning ourselves from the habit, every way we can.

UPDATE: We had a chance to interview Dr. Richard Silkman at MABEP’s training conference, Jan 2010.  View the video!

Instead of waiting until tax time, business owners are now able to receive a cash grant for solar energy systems in lieu of the 30% tax credit.

The program is available for solar hot water and solar electric systems placed in service during 2009 or 2010, or after 2010 if construction began on the property during 2009 or 2010.

An online grant application is available at www.treasury.gov/recovery.

Applications can be submitted after the system is placed in service, or the building is under construction. All applications must be received before the statutory deadline of October 1, 2011. The Treasury will review the applications and make payments to qualified applicants within 60 days after the completed application is received.

To learn more go to Treasury Recovery. Please contact your local ReVision Energy office to learn how you can take advantage of this powerful renewable energy incentive and turn your roof space into a revenue stream!

Above is a 6 kilowatt grid-tied photovoltaic system recently installed by ReVision Energy. In addition to the 30% federal tax credit, The NHPUC is offering a $6,000 cash rebate for residential PV systems in NH.

The NH Public Utilities Commission (NHPUC) is currently accepting grid-tied solar electric system rebate applications. Systems are eligible if placed in service on or after July 1, 2008 and before September 30, 2009.

This rebate is for New Hampshire homeowners and is only for solar electric systems that are less than 5 kilowatts in size. Incentives are capped at $3.00 per watt, $6,000 or 50% of the total cost of the system, whichever is less. For more information regarding this rebate please contact ReVision Energy.

SunPower solar electric panels on a boathouse
overlooking Casco Bay in Falmouth

Efficiency Maine, a subset of the Maine Public Utilities Commission, reopened its rebate program on Monday June 29, 2009.

This is a great opportunity for people who are considering a solar hot water or solar electric installation.

UPDATE: The rebate program has continued into 2010!  See Efficiency Maine’s website for more details.

Solar hot water rebates, both commercial and residential, will be awarded in the amount of $1,000, and buildings that are Energy Star or Maine Home Performance rated may be eligible for a $1,500 rebate.

For all solar electric systems, the rebate amount awarded is $2,000.

In addition to the state rebates, you can receive up to 30% off a solar power or solar hot water installation thanks to federal tax credits.

The rebates will be awarded on a first come, first serve basis. If you think you are going to purchase a solar hot water or solar electric system and have it installed in 2009 or 2010 please contact our office to receive help in filling out the state rebate application.

Solar electric panels sit a top a home in Portland’s Back Bay area.

The Maine Renewable Energy Sources Act is important legislation designed to stimulate the rapid growth of renewable energy in Maine. Developed by the Midcoast Green Collaborative, the Act closely models Germany’s renowned ‘feed-in tariff’ law, which financially incentivizes home and business owners to install renewable energy-based power generation.

The law will require Maine’s utilities to pay a premium to residential and commercial renewable energy generators for the clean solar power that they produce. The funds to do this come from a small utility rate increase that affects all rate payers.

The price paid to clean electricity generators is locked in by a long term contract between grid operators and qualified generators such that renewable energy generators can expect a return on investment of at least 8% per year.

Germany pioneered the feed-in tariff concept in 1999, embarking the country on an incredible renewable energy growth spurt that has made it the worldwide leader in solar installations. Since implementation, the law has resulted in more than 2,000,000 renewable energy system installations and more than 239,000 new jobs. Grid reliability has also increased as a result, making the country’s incidence of blackouts the lowest in the world.

If passed, the Maine Renewable Energy Sources Act will rouse rapid growth of the state’s renewable energy economy, resulting in thousands of new jobs, reduced reliance on fossil fuel energy and greatly reduced CO2 emissions. Maine relies heavily on natural gas to produce electricity, which is part of the reason that Maine has the highest per capita CO2 emissions of all the New England states.

The Maine Renewable Energy Sources Act is currently being considered by the legislature and needs your support. Please contact your local state Senator and tell them that you want to see The Maine Renewable Energy Resources Program passed for a sustainable future.