With Intersolar taking place in San Francisco this week, solar professionals from all over the world are coming together to network and exchange ideas. The Intersolar organizers have chosen the right city for this conference: The city’s mayor Gavin Newsom is actively pushing towards renewable energy sources. Under his leadership, the City and County of San Francisco started the first local solar energy incentive program in July 2008. Since launching GoSolarSF, there has been a 450% increase in applications for solar installations in San Francisco, from 200 to 850. Last week, Newsom announced plans to install three new solar installations with over 365 kw power on the San Francisco Housing Authority as part of the GoSolar initiative. According to a report issued by Environment California last week, San Francisco ranks third in number of rooftop solar installations in California. On a per-capita basis, San Francisco leads the state’s large cities for rooftop solar.
California is leading the US solar energy efforts with 67% of total installed PV capacity (530 MW) in the United States. On average, PV is growing at more than 30% per year – with 2008 having shown more than 150% growth. Californians are thought leaders and progressive thinkers, and much what happens in this state later happens in the rest of the country, according to Gary Gerber, President of CalSEIA (California Solar Energy Industries Association). In a presentation he held at the 5th Germany California Solar Day held by the German American Chamber of Commerce on June 16, he highlighted eight critical factors driving solar in California:
1. Relatively high electricity prices, Time of Use tariffs
2. Increasing electricity demand, especially at peak
3. Electrical infrastructure weakness / grid congestion
4. Strong state rebate program, net metering
5. RPS requirements (Renewable Portfolio Standard)
6. Federal investment tax credit
7. A variety of new incentives
8. Innovative financing (Power Purchase Agreements)
Hurdles to take
Compared to Germany, the cost of installing a solar system in California is more than 30% more expensive. While the average residential system in the US state costs $8 per kw to install, it only costs $6 in Germany. Other challenges Californians are facing include the fact that the installed cost of systems is not (yet) competitive with retail electricity rates without subsidies ($.15 -$.20/kWh), California Solar Initiative incentive levels continue to drop and are now at less than $2/watt, and burdensome paperwork. Gerber during his recent presentation illustrated the latter by the following comparison:
|Typical amount of paperwork for one project in California||Typical amount of paperwork for one project in Germany|
Germany has been at the forefront of solar PV installations worldwide, accounting for almost half of the global solar power market in 2007. Much of this goes back to the country’s feed-in-tariff, part of the Renewable Energy Law (Erneuerbare-Energien-Gesetz, or EEG) enacted by the German government in 2000 (a similar incentive program is still being debated in California). In 2008, Germany installed more than 300,000 new solar systems with a capacity of 1.5 megawatts, according to the BSW (Bundesverband Solarwirtschaft). Solar power now meets about 1 percent of Germany’s electricity demand and is expected to reach 25 percent by 2050.
Germany is represented at Intersolar with numerous companies, and the German Consul General Rolf Schuette is hosting a reception at 1:30 at the German pavillion today – hope to see you there!