When it comes to developing abundant, stable, non-carbon emitting energy alternatives, Arizona is blessed with an embarrassment of natural riches – over 300 sunny days per year. As worldwide deposits of easily accessible, highly entropic carbon-based energy are exhausted, Arizona has the potential to be a leader in promoting renewable solar energy – thereby taking advantage of its natural gifts.
Arizona currently ranks 2nd nationally in installed solar capacity, with 719 megawatts already online. As a result, there are now 9,800 people employed in Arizona’s solar value chain. Analysis of the economic output benefits from each dollar of investment input has demonstrated that every $1 spent on solar development within a community produces $1.67 of local economic activity. Unfortunately, recent political events – both at the state and national level – are threatening this nascent industry.
As the Solar Energy Industry Association (SEIA) has reported, the ongoing federal government shutdown has suspended or curtailed several programs supporting solar energy development. These programs include Bureau of Land Management (BLM) solar permitting activities and the Treasury Department’s 1603 program (providing construction grants to the owner of commercial solar property).
In addition, a prolonged shutdown would threaten the operations of the Department of Energy (DOE) and the Federal Energy Regulation Commission (FERC). This at a time when sequestration has already threatened continuation of the production tax credit benefitting alternative energy sources such as wind and solar. Nonetheless, Bloomberg New Energy Finance recently projected that solar photovoltaic plants alone would add 36.7 gigawatts of capacity nationwide – up 20 percent from last year.
On the state level, the Arizona Corporation Commission (ACC) has been assessing whether to amend its net metering* policy to make it less favorable for residential consumers with solar panel installations – as a result of campaigning by Arizona Public Service (APS), the largest public utility in the state.
APS argues that under the current net metering framework, Arizonans with rooftop solar installations do not pay their fair share of the costs required to maintain the grid – which their installations use as both energy consumers and energy producers. As reported by Mother Jones, opposing APS is Barry Goldwater Jr., chairman of Tell Utilities Solar Won’t Be Killed (TUSK). TUSK contends that what APS is truly concerned about is the potential damage further rooftop solar development may render to APS’s profit margins.
On Tuesday, October 1, ACC’s Staff issued recommendations to the commission to reject APS’s net metering cost-shift proposals and to table its net metering decision until 2015 – for evaluation during APS’s next rate case. While the ACC is not bound by Staff recommendations, the temptation to kick the can on a tough decision further down the road may be too great to pass up.
(*”Net metering” is a mechanism allowing homes and businesses with solar panels to send the excess energy they generate back into the grid and to be compensated for these contributions to the grid.)