The State of Florida cuts solar rebate programs and lowers energy efficiency goals. Can regional and citizen-based efforts make up the difference?
Florida’s tourism industry loves to boast of its year-round abundance of warm sunshine—and they should; there’s plenty to go around. However, when it comes to solar power, Florida utilities only source one percent of their electricity from solar. Furthermore, the state is going to stop helping its residents get this clean source of energy as of January 1, 2016. This is just another step in the state’s larger movement away from renewables and energy efficiency. Fortunately, a combination of county, local and citizen-based efforts are trying to make solar power’s future a little brighter.
The number of large, utility-scale solar installations in Florida, such as this one at NASA’s Kennedy Space Center, has been increasing.
In late November 2014, the state’s Public Service Commission (PSC) voted 3-2 in favor of a utility-backed proposal to eliminate solar rebate programs by the end of 2015 and lowered the state’s energy efficiency goals by more than 90 percent. This was decided after a very lengthy debate that lasted almost two hours. The utilities lobbied that the energy efficiency programs were not cost effective and claimed that it’s less expensive for them to produce a kilowatt of electricity than it is to save one. At one point, it was even suggested that it was more cost effective to tear down the coal-fired plants and build natural gas or co-generation plants.
The PSC’s decision certainly varies from other states, such as Vermont, which meets 2.12 percent of its energy needs through savings. Florida saves 0.25 percent, and that number is likely to fall after this decision. Duke Energy and Florida Power & Light dropped their conservation goals and cut back on their rebate programs.
After the decision, environmental groups were contemplating whether the PSC violated state law by instituting a policy that leaves utilities with virtually no energy efficiency requirements. We have not found any evidence to date that they have taken legal action against the PSC.
The Consumer Effect
Meanwhile, consumers won’t see a big difference in their wallet. Depending on their utility, consumers will see their bill reduced by anywhere from $0.16/month to $1.94/month. However, in looking deeper at those numbers, the savings are generated by lower fuel prices, which the utilities do not control nor from which they profit. If fuel prices rise, those savings would evaporate and consumers could see an increase in their bills. Sadly, such an increase could have been mitigated were it not for the short-sighted elimination of the energy efficiency programs designed to buffer consumers from price spikes.
A New Approach to Solar
The year-end conclusion of many of these incentive programs can, in some instances, be a bit misleading. Some programs were so popular that the rebate budgets were exhausted well in advance of December 31, 2015. For example, Tampa Electric was offering a $1,000 rebate for solar water heating systems. The program was set to expire at the end of 2015. In February 2015, they had stopped accepting applications and the money was exhausted by mid-June, 2015.
In the absence of the state programs, counties and local governments have stepped up their efforts to promote energy efficiency. According to a review of the Database of State Incentives for Renewables & Efficiency (DSIRE), five cities or counties have created rebates or incentive programs in the last four years. One example is the City of Winter Park, which offers a variable rebate program (depending on the technology and sector). While they have exhausted all funds in this fiscal year, it will resume in the next fiscal year.
The Orlando Utilities Commission (OUC) is the lone utility in Florida who is rewarding solar PV production. They offer a number of incentives. One we’ll highlight here is their $0.05 kWh credit. According to their website, “customers receive a monthly credit on their OUC bill of 5.0 cents per kWh produced by the solar system regardless of whether the energy was used by the customer or sent back to the OUC grid.” Chris Castro, founder of IDEAS for Us and ardent advocate for the proposed constitutional amendment, says that incentive represents a 50 percent increase in value compared to other utilities.
A group of citizens in the City of Orlando has formed the Central Florida Solar Advocates, a solar cooperative that is helping homeowners purchase solar in a cost-effective way. By joining the cooperative, homeowners become educated on renewable energy systems, collectively bid and select a solar contractor and then purchase the equipment and services in bulk. This has shown to lower the total installed cost per watt to less than $2 for a residential system, a 30 to 40 percent savings compared to purchasing an array at retail. The co-op has more than 30 members and is growing at a rapid pace. “Through economies of scale, this new approach to solar is helping the contractor install more systems and saves money for homeowners interested in doing the right thing; a true win-win-win situation,” states Castro.
To Ballot or Not to Ballot
As previously stated, the state’s solar rebate program is going away on the first day of 2016. Given the current and projected market dynamics of panel pricing and traditional power generation costs, Florida’s solar industry can probably stand on its own.
The non-profit Floridians for Solar Choice is gathering signatures for a ballot initiative that would give Floridians the right to choose solar power. www.flsolarchoice.org
That doesn’t mean it would reject a helping hand. Since the industry is still fighting for market share against entrenched energy sources like natural gas, coal and nuclear, there are other efforts underway to keep growing solar’s market share. A citizen’s group called Floridians for Solar Choice is looking to get a constitutional amendment on the ballot in November 2016.
Florida is one of four states that does not allow third-party Solar PV Power Purchase Agreements (PPA). PPAs allow a citizen to purchase electricity from the company that puts solar panels on the roof of your home or business. Floridians for Solar Choice is proposing an amendment that would allow businesses and individuals to sell a maximum of two megawatts of solar power.
This movement has brought together some uncommon allies. Greenpeace, the Sierra Club, the Climate Reality Project, Florida Wildlife Federation and IDEAS for Us have joined with the Christian Coalition, the League of Women Voters, the Florida Alliance for Retired Americans, the Libertarian Party of Seminole County and Tea Party activists to further the ballot initiative. This has put them at odds with the utilities, backed by the special interest group Americans for Prosperity, which seeks to keep control of their existing market dominance. This issue has even pitted some local governments against bordering municipalities.
Predictably, this battle has found its way to the courtroom, albeit a lot earlier than you might have imagined. The utilities asked the Florida Supreme Court to reject the future ballot amendment, on the grounds that some cities would lose tax revenues. A number of cities have disputed that claim, calling their rationale “aggressive and speculative.” At the core of the Supreme Court case are two questions:
- Does the ballot language fairly show the amendment’s impact?
- Is it limited to just one subject?
Before they can get anything placed on the ballot, they need to capture over 680,000 verified signatures by February 1, 2016. (As of October 1, they had 160,000 verified, with another 100,000 in the process of review.) They have quite a way to go in a relative short period of time, but Castro and a host of others are working very hard to meet the requirement.
This issue might be more palatable if the utilities would just be upfront with what they’re trying to do. They are trying to lower their costs, increase their profit margins and temporarily (or perhaps permanently) stifle competition in order to better position themselves to compete in a marketplace where rooftop solar is eating away at their revenues. The utilities are also campaigning hard against the proposed amendment. At the same time, they are announcing new, large-scale solar projects, with ever-increasing solar outputs. Nothing like trying to have your cake and eat it, too. The grassroots effort by the various citizen groups is highly commendable, given the odds they face. And credit should be given to OUC for not abandoning the production capabilities of rooftop solar. It is our hope that this situation gets resolved in the favor of Florida’s future generations. Their well-being should be paramount.
Note: At press time, the Florida Supreme Court had not yet issued their ruling.
“Florida regulators approve plan to gut energy efficiency goals, end solar power rebates” by Ivan Penn, Tampa Bay Times, November 25, 2014. http://bit.ly/11SQrbK
OUC - http://bit.ly/1LwHn1d
DSIRE - http://www.dsireusa.org
Floridians for Solar Choice - http://flsolarchoice.org
“Enviros, Tea Partiers, and the Christian Coalition all agree: Florida needs more rooftop solar” by John Light of grist.org, July 10, 2015. http://bit.ly/1L1xEKK
“Utilities change their tune on solar power” by Ivan Penn of the Tampa Bay Times, May 29, 2015. http://bit.ly/1KDmhwt
DSIRE Third-Party Solar PV Power Purchase Agreement (PPA) - http://bit.ly/1VXLO7N
“Solar amendment supporters, opponents square off before Florida Supreme Court” by Michael Auslen of the Tampa Bay Times, September 1, 2015. http://bit.ly/1IEHIab
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