By TIM FAULKNER/ecoRI News staff
This proposed solar initiative would require massive,
multi-terawatt expansion and improvements in technology, both of which are
plausible, according to the 356-page report titled “The Future of Solar
Energy.”
Specifically, the study says, the cost of solar systems must
continue to drop, improvements to power-grid connections must be made and
support for developing large-scale electricity storage improved. The benefits
will not only help the United States but also bring light and electricity to
remote locations around the world, the report predicts.
The study also suggests that traditional residential photovoltaic (PV) and more utility-scale concentrated solar power (CSP) systems, such as the Ivanpah Solar Electric Generating System in California’s Mojave Desert, can drive the growth. Because CSP systems work by heating a fluid such as water, they can store that heat and generate electricity as needed, helping to fix the problem of delivering renewable power on demand.
CPS systems also work as a hybrid power source that can operate in
unison with an existing natural-gas power plant, according to the report. New
England, however, is too cloudy and hazy for CSP systems.
Hydroelectric power also can address electricity demand needs,
while new high-efficiency technologies such as crystalline silicon solar panels
and thin-film solar are available and will help lower costs and increase power
generation.
Growth in U.S. solar energy has increased in the past six years to
more than 18,000 megawatts of solar capacity. Financial incentives, third-party
ownership that includes leasing and a 50 percent to 70 percent drop in PV costs
has aided much of this growth. Costs are expected to continue to fall as
competition increases, according to the study.
The report also addresses some controversial issues. Significant
pushback has occurred in Hawaii and Arizona after utility companies tried to
impose fees on solar customers in order to pay for ongoing use and maintenance
of utility poles and electric wires, also know as transmission and distribution
networks.
The MIT report says costs are incurred by utilities to meet the growing flow of solar electricity in both densely populated and rural regions. The study recommends that costs for grid connection be more fairly distributed among traditional electricity ratepayers and renewable-energy customers, whose monthly charges for these costs are sometimes eliminated by selling the electricity generated back to the electric company.
The MIT report says costs are incurred by utilities to meet the growing flow of solar electricity in both densely populated and rural regions. The study recommends that costs for grid connection be more fairly distributed among traditional electricity ratepayers and renewable-energy customers, whose monthly charges for these costs are sometimes eliminated by selling the electricity generated back to the electric company.
The report also argues against restoring the popular 30 percent
federal investment tax credit, in favor of incentives that reward the most
productive electricity producers. Without a fee on carbon emissions, however,
subsidies are still needed, and grants are preferred as the more effective and
transparent incentive than tax credits.
Washington, D.C.-based Solar Energy Industries Association (SEIA)
says the MIT report “offers an incomplete and flawed picture of solar
economics.” SEIA says the MIT report overlooks the impact of larger rooftop
solar arrays — the costs of which are similar to the larger utility-scale
arrays but lack the problems of the ground-mounted, utility-scale solar
installations the MIT report favors.
Those problems, SEIA says, include siting and land-use issues, and, in some cases, permitting red tape on federal land.
Those problems, SEIA says, include siting and land-use issues, and, in some cases, permitting red tape on federal land.
The high soft costs for rooftop solar that the report sites are
declining, according to SEIA. The real benefits of rooftop solar is that it
delivers power directly to the electricity supply, often in regions with busy
power grids, thus reducing the need for transmission and distribution network
upgrades, said Ken Johnson, SEIA vice president of communications.
The MIT report recommends that state mandates for the amount of
clean electricity delivered to electric outlets, called renewable portfolio
standards (RPS), should be replaced by a national standard. A single benchmark
would spark renewable-energy development across the country and allow for the
free trading of the renewable-energy credits that traditional power producers
rely on to meet targets, according to the report.
The principal goal of renewable-energy development, the report
concludes, should be reducing greenhouse-gas emissions. And without
disincentives for polluters, such as a carbon tax, government programs and
subsidies are essential to make the highly attainable changes, the reports
states.
Otherwise, the report says, solar energy will only meet a small percentage of global electricity needs while the cost of reducing carbon emissions will remain high.
Otherwise, the report says, solar energy will only meet a small percentage of global electricity needs while the cost of reducing carbon emissions will remain high.
“Until Congress is willing to adopt a serious carbon pricing
regime, the risks and challenges posed by global climate change, combined with
solar energy’s potential to play a major role in managing those risks and
challenges, create a powerful rationale for sustaining and refining government
efforts to support solar energy technology using the most efficient available
policies,” the MIT report reads.
Rhode Island, like many states in the Northeast, is already using
some of the report’s recommendations. Rhode Island participates in one of the
few cap-and-trade programs that imposes fees on
power-plant carbon emissions. The proceeds help fund renewable-energy programs.
Rhode Island also offers grant-based incentives for solar projects
of all sizes and emerging solar technologies — all of which are subsidized
through utility bills, which the MIT study says is preferable to incentives
funded by tax breaks. Utility-based fees are preferable because higher electric
costs make renewable energy more economically viable, according to the study.
Rhode Island’s distributed generation program,
however, operates counter to what the MIT report recommends. The Rhode Island
program is a version of a feed-in tariff, a program found in other states and
Europe. A feed-in tariff offers a fixed price, generally above the market rate,
for electricity for a fixed period.
The MIT report says the feed-in tariffs are good for boosting
initial development and attracting investors, but claims they don’t reward the
systems with the best production or account for current energy prices. The
report suggests an “output-based” model that pays renewable-energy projects a
premium for the electricity they produce during peak demand.
“The current system of rewarding invest instead of performance is
so far from optimal,” said Richard Schmalensee, an MIT management and economic
professor-emeritus and an author of the report. “Why would you want to
subsidize investment rather than output?”
Rhode Island for its part rolls out a new version of its feed-in
tariff program this summer for both small and large solar projects.