Tax Reform – What Does It Mean For Solar?

Tax Reform – What Does It Mean For Solar?

This week’s show is about TAXES. Please try to contain your excitement.

It’s been 32 years since President Reagan pushed through the last comprehensive tax reform bill. The Tax Cuts and Jobs Act of 2017 makes similar huge changes in the ways that individuals and businesses pay their taxes. Every sector of the economy will be affected, as will everyone’s personal returns. (more…)

Trump’s Anti-Environment Policies

Trump’s Anti-Environment Policies

President Donald Trump is on a roll when it comes to Executive Orders and new regulations that apply to energy and the environment. Unfortunately, almost all these Executive Orders and regulation changes are bad for the environment, and will likely result in more expensive and less reliable energy. (more…)

Designing a Reliable Electric Grid

Designing a Reliable Electric Grid

Over the past few months we’ve experienced a solar eclipse, several devastating hurricanes, another under-construction nuclear plant shutdown, and a backwards-looking Department of Energy Grid Reliability study.

The performance of our electric grid during the eclipse demonstrates how well a flexible, well-managed grid can handle predictable events. These severe weather events show how vulnerable our electric grid really is, how dependent we as a society have become on electric power, and how valuable some form of backup power is for homeowners. The nuclear plant shutdown clearly shows that nuclear power cannot compete against cheap natural gas. (more…)

San Jose Mercury News Op-Ed: More solar panels and battery storage at homes could prevent power failures

San Jose Mercury News Op-Ed: More solar panels and battery storage at homes could prevent power failures

At 1:30 on a Sunday afternoon in June, I experienced the second power outage at my Silicon Valley home this year. Then, last weekend a transformer explosion at a Los Angeles Department of Water and Power substation left 140,000 people in the San Fernando Valley without power. In both cases these power failures occurred during a 100+ degree heat wave.

According to PG&E, there was a “local transformer issue” in our neighborhood; the Los Angeles utility is still investigating the cause of their transformer failure.
Local transformers are those big can-shaped things at the top of utility poles. Most were installed before electric vehicles were commonplace and when temperatures were a few degrees cooler. So when people crank up their air conditioners and plug in their EVs, transformers can become overloaded and fail.

Power was out in my neighborhood for about 12 hours while PG&E deployed a crew to diagnose the problem and replace the transformer. But the blackout would not have happened if just one more home in the neighborhood had a solar or battery storage system.

The output from that incremental solar or storage system would have supplied the electricity needs of that home — and the excess solar or battery power would have flowed back to the local grid, reducing the load on that transformer and preventing its failure.

High temperatures and new electric vehicle demands are causing outages like this all over California. Solar power coupled with battery storage is the cleanest and most cost-effective solution to this problem, but only if these systems are deployed in the right place.

The challenge is to get the power from remote utility solar plants to the homes and businesses that need it. Unfortunately, the local power grid is the weakest link, and it is expensive to modernize neighborhood grids to meet today’s higher power demands and two-way energy flows.

There are two solutions to modernizing overloaded local grids. The “business as usual” solution is to pay the local utility for upgrades that include bigger transformers, wiring, control systems and battery storage. Unfortunately, ratepayers get stuck with higher electric bills for this.

A much better solution is to encourage homeowners and businesses to install their own solar and storage systems. These customer-owned “Behind the Meter” (BTM) energy systems do not require expensive transmission and distribution grid upgrades. Since investments in them are made by homeowners and businesses, utility ratepayers are not burdened with upgrade costs.

With over half a million solar-powered homes and businesses, California leads the country in both solar power generation and solar jobs. This was the result of public policies that encouraged solar installations. As a result, solar costs have come down so much over the past 15 years that incentives are no longer needed.

We have the same opportunity now with battery storage systems as California moves toward an electric grid powered 100 percent by renewables. Two policies will help us achieve this goal.

First, as other states have done, we should ensure that there are no arbitrary limits on a customer’s ability to install solar and battery storage. Second, we need to reduce the up-front costs of battery storage systems, which are relatively expensive at this early stage of the market.

To jump-start the battery storage market and improve local grid reliability, California has proposed SB-700, the Energy Storage Initiative. It mimics the California Solar Initiative in a way that supports home or business-owned energy storage systems with incentives that decrease as costs decline. With policies like this, electric customers throughout California will be the first to benefit from a modernized electric grid that is both lower cost and more reliable.

Originally published July 12, 2017. Barry Cinnamon is the CEO of Cinnamon Solar and previously founded Akeena/Westinghouse Solar. He wrote this for The Mercury News.

DOE Jobs Report

In January the DOE published their annual jobs report. The U.S. energy industry employees 6.4 million people. The largest two employment categories are oil extraction and solar, with solar growing the fastest among all fuel types. According to the DOE Jobs Report, by the end of 2016 there were 374,000 American’s employed at least partially by the solar industry. Paralleling the DOE jobs study, the Solar Foundation recently released their own employment study indicating that 260,000 American’s working directly in the solar industry – one out of every 50 new jobs created.

Although the technology of solar generation is fundamentally different than fossil-generated electricity (lots of up front construction but free fuel) the breakdown of workers is very similar to other electric power generation sources. 37% of solar employees work in installation or maintenance positions, 26% in supply chain positions, 18% in manufacturing and 15% in professional services.

The majority of U.S. photovoltaic generation is utility-scale, roughly 28,081,000 MWh, compared to 16,974,000 MWh of distributed solar generation (note that this is energy generated, not capacity). However, in 2016, over half of the nation’s solar workers were spending the majority of their time working on residential solar. This imbalance reflects the fact that utility-scale generation typically produces more MWh’s per labor unit installed compared to distributed generation. On the other hand, residential and commercial solar provides more value to customers. Power generated at utility-scale facilities costs 5 cents/kwh, totaling $1.4 billion for this energy. Power generated on residential and commercial rooftops cost an average of 10 cents/kwh, but the savings to consumers were even greater at $1.7 billion.

So by all accounts, solar energy is a jobs engine. Although there may be environmental headwinds from the Trump Administration, there are no signs that the economics for solar-generated electricity will falter any time soon. Please Listen Up to this week’s Energy Show on Renewable Energy World as we delve into the technologies and market segments that make up the U.S.’s energy industry.

Carbon Tax

“Pigovian Tax.” If you know what this means, then you can skip this week’s Energy Show on Renewable Energy World. For everyone else (including me until I looked up the word) a Pigovian tax is a tax levied on an undesirable market activity to offset the negative effects of said activity. The carbon tax is a Pigovian tax – hence the addition of this obscure word to our Renewable Energy World vocabulary.

Nobody likes to be taxed – especially the industries that are directly affected. However, sometimes vice taxes are a necessary evil in order to discourage bad behavior. In the case of taxing carbon usage, most economists have concluded this is the most effective way to reduce CO2 gas emissions. The European Union has implemented an effective carbon tax, and leads the world in reducing carbon dioxide emissions. But here in the United States, where the word “tax” can quite literally get you thrown into the Boston Harbor (with your chests of tea), we have been slower to adopt these changes.

But there continues to be momentum behind effective economic mechanisms to reduce CO2 emissions. To avoid the specter of increasing taxes, some states have implemented more business-friendly cap and trade programs. California’s cap and trade program, initiated in 2011, continues to reduce state’s emissions, while at the same time directing the resulting proceeds back to the state’s transportation, clean energy, energy efficiency, natural resources and recycling activities. Listen up to this week’s Energy Show on Renewable Energy World as we talk about practical carbon tax options – in spite of the temporary political reluctance to do so in the U.S.