Monday, October 03, 2016
NOTES FROM THE SENATE, OCTOBER 3, 2016
IN GEORGIA THE SUN SHINES FOR SOLAR INCENTIVES
The renewable energy industry in Georgia and nationally has been aided by incentives, both financial and regulatory, which make building and owning renewable energy systems more affordable. These incentives are based on the fact that there is usually a large up-front cost to buy solar panels. Various governments have created incentives to spur development of the renewable energy sector to help it reach a self-sustaining point.
HOW MANY INCENTIVES ARE THERE?
Between local, state, and federal governments, there are approximately 13 different financial incentives available to aid individuals and corporations in purchasing, installing, and operating solar electricity generation systems. Local incentives are rebate programs which are mostly established by Georgia Power and the various electric membership corporations and cities. The state incentives include performance based buyback incentives, loan programs, grant programs, and others. Federal incentives include corporate tax credits, corporate tax deductions, corporate depreciation, corporate tax exemptions, personal tax exemptions, personal tax credits, and grant and loan programs.
There are seven regulations specific to Georgia and four that are federal. These regulatory incentives mainly provide for specific agreements like the Solar Power Free Market Financing Act (HB57, 2015 Session) which became effective on July 1, 2015. This act provides a framework of financing options for residential and non-residential solar power systems. Prior to the act, owners of solar power systems could enter into a buyback agreement with GPC. This is known as net metering. The act allows for the buyback prices to be based on the performance of the solar power system. This provides a greater incentive to purchase and install solar panels for residential and non-residential operation. The act does restrict the size of solar systems which qualify for buybacks. Residential systems cannot be larger than 10 kilowatts and non-residential systems cannot produce more than 125% of annual peak demand (OCGA 46-3-60 through 46-3-66).
The Georgia Public Service Commission (PSC) has also aided in incentivizing solar adoption by approving the GPC's Advanced Solar Initiative (GPASI). This program seeks to procure utility scale and distributed generation solar energy. In the 2016 Integrated Resource Plan (IRP) the PSC approved an additional 1600 megawatts of renewable energy to be added to Georgia's energy source mix by 2021.
TRENDS IN RENEWABLE ENERGY INCENTIVES
Across the nation there are differing views among states as to what the right balance of incentives is for the renewable energy industry some states, like Georgia, North Carolina and California, are pushing forward with the development and procurement of solar energy in particular and renewable energy more broadly. California in particular has incentivized the solar industry by providing for higher rates in buyback agreements between solar energy producers and utility companies. According to the US Energy Information Administration, North Carolina is second only to California in adding utility scale solar facilities. North Carolina has a regulatory incentive which requires 12.5 percent of its electricity to be generated from renewable energy sources by 2021.
SOME STATES STEP BACK
Vermont was known as one of the friendliest states towards solar installations thanks to its net-metering program with a relatively high fixed rate for the buyback agreements. The Vermont Public Service Board decided in June to reform its solar incentives to lower the buyback rate and institute some new fees for existing solar panel owners along with a cap.
The most extreme cut back on solar incentives has been in Nevada where the state ended its incentive program altogether. This resulted in several solar companies laying off employees and leaving the state. Hawaii has scaled back its net-metering program by reducing the buyback rate for new applicants.
GEORGIA - A GROWING SOLAR STATE
Georgia's incentives for solar energy seem to be in the middle ground. They are not so high as to invite over development of solar, and not so low as to deter individuals from installing solar energy systems. Georgia has a growing solar industry and as solar electricity prices continue to fall it will become more attractive for individuals and companies to install some panels of their own. There are many companies throughout the state which have taken advantage of these incentives and they are saving money on energy costs as a result. Next ... some success stories from companies which have gone solar to reduce costs.
Georgia and local incentives may be accessed at: http://energy.gov/savings/search?f%5b0%5d=im_field_rebate_state%3A859981&f%5b1%5d=im_field_rebate_savings_for_shor%3A864773. The federal tax credit program may be accessed at: http://energy.gov/savings/residential-renewable-energy-tax-credit.