| A proposal in Arizona could change the way solar | | | | those incentives, meaning they aren't lost and are |
| energy is marketed. | | | | reflected down the road in cheaper installation costs |
| Typically, solar energy firms install solar panels, or | | | | across the board as profits drive down the cost of |
| arrays, on a given facility and the proprietor (business | | | | solar panels. |
| or homeowner) buys or leases the setup, uses the | | | | That benefit alone, in a time of continuing recession, is |
| electricity, and sells any excess back to the local or | | | | tempting. According to SolarCity, schools could save |
| regional utility which supplies power to the facility. | | | | $4.7 million on energy over the next 15 years by |
| In Scottsdale, Foster City, a California-based SolarCity | | | | adopting the process. |
| Corp. wants to install solar panels on two school roofs, | | | | SolarCity is not the first to make the suggestion, either. |
| essentially for free, and allow the school district would | | | | In October of 2008, Solar Alliance, a state-based |
| buy the electricity generated. | | | | advocacy group for solar designers, manufacturers, |
| This has regional utility Salt River Project (SRP) up in | | | | installers and financiers, asked the Corporation |
| arms. Arizona Public Service Company, the other | | | | Commission to approve similar proposals. In fact, third |
| regional utility (and the larger by 3,998 megawatts and | | | | party ownership using power purchase agreements |
| 600,000 customers), has posed no objections, even | | | | (PPAs) was discussed as an option on Eshone |
| though both will be required to testify before the | | | | Energy's blog. |
| Arizona Corporation Commission, Arizona's equivalent | | | | The Arizona Corporation Commission has yet to get |
| of a public utilities commission. | | | | back to them, because the decision-making process |
| The schools in question are Coronado and Desert | | | | challenges so many utility paradigms that there are no |
| Mountain high schools. The issue in question is: can a | | | | parallels, or precedents, to draw upon. |
| solar manufacturer operate as a utility? Backers of the | | | | This is especially true as customers would still be |
| proposal see it as a huge incentive to solar power, | | | | connected to their local utility for electrical needs |
| because it frees proprietors from the sometimes huge | | | | beyond the capacity of the individual solar systems. |
| upfront costs of installing solar arrays. Opponents | | | | Also weighing heavily on the equation are Arizona's |
| argue that it would let solar panel manufacturers sell | | | | renewable energy mandates, which requires utilities to |
| electricity without the oversight of state utility | | | | get 15 percent of their energy from renewable |
| regulators, leading to electric-pricing disputes and abuse. | | | | sources like solar and wind by 2025. |
| Returning to the issue of upfront costs in solar power, | | | | SolarCity has so far rebutted SRP's challenge by |
| some have noted that, while individuals and even | | | | saying that, since it is not a monopoly, it doesn't need |
| corporations can offset these with any number of | | | | Corporation Commission regulation. |
| federal, regional and local incentives, government | | | | As Corporation Commission Chairwoman Kris Mayes |
| buildings and schools aren't eligible for many of them, | | | | points out, the entire solar community (and the nation) is |
| largely because such properties are financed with | | | | waiting for a resolution of these difficult issues. Tom |
| tax-exempt private activity bonds or other federal, | | | | Alston, the head of Solar Alliance in Arizona, confirms |
| state, or local subsidized financing (Section 48 of the | | | | that, and notes that more than half the recent |
| Investment Tax Credit). | | | | applications for solar installations in the state have |
| SolarCity argues that those limitations are slowing the | | | | been coordinated through a solar-service agreement |
| growth of solar power, and many educators and public | | | | like the one SolarCity offers. |
| officials agree. Equally as important, SolarCity, as the | | | | Clearly, if the proposal is rejected, solar will suffer a |
| installer and owner of record, can take advantage of | | | | huge defeat in sunny Arizona. |