How two states support renewable energy (or not)

Posted 8/21/12

Solar power is turning into a growth industry. The total installed solar capacity in the U.S. has doubled in the last several years, and there has been a rapid drop in the average price per watt of …

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How two states support renewable energy (or not)

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Solar power is turning into a growth industry. The total installed solar capacity in the U.S. has doubled in the last several years, and there has been a rapid drop in the average price per watt of solar-generated electricity. Some experts now predict a doubling of solar PV panels on homes and small businesses every two years, creating a growth industry with the potential to become a significant job-creator. Yet, Pennsylvania seems to be missing the message and, if it is not careful, the burgeoning solar energy economy will simply pass it by.

At a time when states should be creating incentives for people to install solar PV panels and other renewable sources of energy, PA’s Public Utility Commission (PUC) recently proposed rule changes unfriendly to small-scale solar generation. Analysis by the Mid-Atlantic Renewable Energy Association (MAREA) indicates that one of the proposed rules would allow the PUC to grant permission to utility companies to charge a monthly fee to customers who operate their own solar generating systems. (Talk about a disincentive!) A second new rule would restrict how much solar power a utility’s “customer-generator” could produce, limiting it no more than 110% of the customer’s annual electricity usage. (Don’t we need to be developing more renewable electricity, not less?) In addition, according to the Sierra Club, the PUC’s proposed rule changes “threaten third-party ownership models (such as leasing and power purchase agreements) for solar and other distributed generation.”

The PUC is accepting public comment on its proposed rule changes until August 4. Both MAREA and the Sierra Club have sent out action alerts asking Pennsylvania citizens to send comments to defend rooftop solar by rejecting these rules changes. Or one can contact the PUC directly by writing, calling or via email (refer to docket number L-2014-2404361). Official comments for the record should be sent to the PUC’s Secretary’s Bureau, P.O. Box 3265, Harrisburg, PA 17105-3265.

The bigger truth, however, is that Pennsylvania’s renewable energy policies in general are woefully inadequate. The commonwealth seems to be stuck in its fossil fuel past. It continues to pursue policies that support coal production, a declining industry that peaked in PA in 1998 and has since seen production decline 27% (2010 data: downstreamstrategies.com/documents/reports_publication/ds_penncoal_budget_final.pdf), and second, it strongly supports its natural gas industry, declining so far to impose a severance or extraction tax. (Just imagine a PA natural gas industry tax that channeled funds to create a vibrant renewable energy industry.)

Just next door to Pennsylvania, New York State (NYS) is pursuing a more enlightened path. By 2021, Pennsylvania’s goal, as spelled out in its alternative energy portfolio standards (AEPS) is to produce 18% of its energy from alternative sources (at least 0.5% from solar) compared to New York’s goal of 30% by 2015, as spelled out in its renewable portfolio standards (RPS). In 2013, renewable energy accounted for nearly four percent of Pennsylvania’s net electricity generation compared to NYS, which in the same year saw 23% of its electricity coming from renewable resources. (If you’re wondering what’s the difference between an AEPS and an RPS, a closer look at PA’s AEPS offers an explanation; its AEPS includes energy sources like waste coal, coal mine methane and coal gasification, which it lists side-by-side with clean, renewable technologies like solar, wind, geothermal and hydroelectric (www.c2es.org/node/9340)).

Where NYS has two personal tax credit programs to promote cleaner energy (a refundable clean heating fuel tax credit and a residential solar tax credit), PA has nothing. Where NYS has a refundable clean heating fuel tax credit for corporations, PA has nothing. Where NYS has three sales tax initiatives (a solar sales tax exemption, an option for localities to have such a tax exemption and a residential wood heating fuel exemption), PA has nothing. Where NYS has three property tax initiatives (an energy conservation improvements property tax exemption, a local option for real property tax exemption for green buildings and a local option for exempting solar, wind and biomass energy systems), PA has one property tax assessment initiative for commercial wind farms.

The commonwealth does have five rebate initiatives to help utility companies, but its once popular Sunshine Residential and Small Business Solar PV Program has run out of funds and has been inactive since last November. And PA does have six loan initiatives; most are for businesses, economic development organizations, municipalities, counties and school districts, compared to NYS’s offerings for home energy performance with Energy Star financing as well as residential loan funds. (For a further overview of these two states’ programs, see www.dsireusa.org/summarytables/finre.cfm).

At the end of the day, we are left to conclude that Pennsylvania’s policymakers and elected officials, who should be supporting and funding renewable energy investment programs, apparently do not “get it.” Every residence, every business (large or small), every school or government building that converts to renewable energy is helping to build a more diverse economy, a cleaner environment and a more sustainable energy future. Pennsylvania needs to get on board.

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