Solar Benefits Study for PA & NJ - Press Release

New Study Finds that Solar Power is a Bargain for Ratepayers in Jersey and Pennsylvania

The value solar energy delivers exceeds its cost by 50% to over 100%

Bordentown- November 5, 2012 - The Mid-Atlantic Solar Energy Industries Association (MSEIA) and the Pennsylvania Solar Energy Industries Association (PASEIA) today released a study by consulting firm Clean Power Research showing that solar power in New Jersey and Pennsylvania delivers value to the electric grid that exceeds its cost by a large margin, making it a bargain for energy consumers.

Energy providers in New Jersey and Pennsylvania are required to buy certain amounts of solar power each year.  They pay a premium for that solar power in the form of Solar Renewable Energy Certificates, or SRECs, and pass this premium cost on to ratepayers.  The study found that solar power delivers a total levelized value ranging from $256 to $318 per MWh (25.6 cents to 31.8 cents per kWh).  However, this includes a premium value in the range of $150 to $200 per MWh (15 cents to 20 cents per kWh), above the value of the solar electricity generated.  The SRECs in New Jersey currently cost about $60/MWh (6 cents per KWh), and in Pennsylvania they cost about $20/MWh (2 cents per KWh). 

 

“This indicates that electric ratepayers in the region are getting more than a two-to-one return on their investment in solar energy”, said Dennis Wilson, President of MSEIA,  “Although the current SREC prices are unsustainably low, our analysis indicates that SRECs can increase in price , deliver net benefits and still support strong solar growth.   Solar power has proven it can deliver value that exceeds its cost by 50% to over 100%.  This net positive benefit will only increase as solar technology continues to drop in cost”. 

 

Full text of the report is available at: http://mseia.net/site/wp-content/uploads/2012/05/MSEIA-Final-Benefits-of-Solar-Report-2012-11-01.pdf

“Both states have considered expanded investments in solar energy. This study shows that

such programs and policies are well justified from an economic standpoint and generate far

more instate jobs than central plant generation. Add together the proven public health,

security and environmental benefits, and it’s clear that aggressive solar power development

is a win for these states and their residents,” said Lyle Rawlings, Vice President of MSEIA,

New Jersey division.

“We are very excited about this study”,  said Ron Celentano, President of PASEIA and Pennsylvania VP of MSEIA.  “For the first time the solar industry can show the quantitative benefits of implementing solar energy technologies specifically in Pennsylvania and New Jersey.  For more than three years we have been unsuccessful with enhancing our solar share requirement in Pennsylvania, largely because solar was perceived as only a cost to rate payers.  But this study concludes that the value of solar far exceeds the costs to both the rate payer and taxpayer.”

“Solar PV does not get a fair shake in our current utility accounting protocols because those rules evolved for centralized, large scale power plants” says Roger Clark, manager of The Reinvestment Fund’s Sustainable Development Fund, a major funder of this study. “We supported this study because it is critical to understand the costs and benefits of solar so that our energy policies, such as Pennsylvania’s Alternative Energy Portfolio Standards Act, are grounded on an accurate perception of the value of solar energy.”

Both New Jersey and Pennsylvania are major solar markets in terms of the amount of solar capacity already installed. Each has great opportunity for continued clean energy industry growth. New Jersey, the nation’s second-largest solar market with 900 MW of solar capacity, is the first state to generate more than 1% of its annual electricity from solar energy.  Its annual solar share is now approaching one and a half percent, with contributions during peak demand periods several times higher. Once one of the nation’s fastest growing solar markets, Pennsylvania has since fallen to eighth place in installed capacity. Increasing the state’s near-term solar commitment would put Pennsylvania solar growth back on track.

According to Richard Perez, one of the authors of the study, “This report broke new ground in that it incorporated a wealth of utility power cost data, enabling detailed analysis of economic drivers such as the ‘merit order effect’, according to which power can have different values depending on when it is generated.  Solar energy has inherent advantages stemming from such economic drivers”.  Today’s report assessed the value of modest solar penetration (15% of utility peak load) at six locations: Pittsburgh, Harrisburg, Scranton, Philadelphia, Newark, Atlantic City, and Jamesburg. Research concluded that by offsetting the need for conventional power, distributed solar power delivers measurable benefits, including: 

• Lower conventional electricity market prices due to reduced peak demand;
• Valuable price hedge from using a free, renewable fuel rather than variably-priced fossil fuels;
• Avoided costs of new transmission and distribution infrastructure to manage electricity delivery from centralized power plants;
• Reduced need to build, operate and maintain natural gas generating plants;
• Reduced outages due to a more reliable, distributed electric power system;
• Reduced future costs of mitigating the environmental impacts of coal, natural gas, nuclear, and other generation;
• Enhanced tax revenues associated with local job creation, which is higher for solar than conventional power generation.

Prepared by Clean Power Research, the report was funded by the following organizations: The Reinvestment Fund’s Sustainable Development Fund, Mid Atlantic Solar Energy Industries Association, Advanced Solar Products, SMA Americas, Vote Solar, Renewable Power, and Geoscape Solar.

About MSEIA

MSEIA, the Mid-Atlantic Solar Energy Industries Association, is a solar energy advocacy trade association which represents over 100 solar companies doing business in New Jersey, Pennsylvania, and Delaware.

Established in 1997 by solar energy advocates, MSEIA is an historic and highly-effective non-profit membership organization created to advocate for solar energy incentives, create permanent solar energy jobs and a renewable energy infrastructure, and promote solar energy as a viable and important source of energy for the future.  Our efforts in the legislature and with the Board of Public Utilities have been instrumental in helping to create the New Jersey solar industry.

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About PASEIA

The Pennsylvania Division of MSEIA.  PASEIA is an organization of manufacturers, developers, contractors, installers, architects, engineers, consultants and other industry professionals dedicated to advancing the interests of solar energy and to developing a strong local PA industry offering high quality installation and professional services to business and residential customers in the region we serve.

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PASEIA Update

Due to the short legislative session before they break for election, it is clear neither the Senate nor House will bring up the solar bill for a vote before session ends. There are  only a few  legislative calendar days scheduled:  four days left on the Senate calendar and ten in the House and not all days will be voting days. This doesn’t leave adequate time to pass either HB 1580 or SB 1350 in both Houses and get it before the Governor for his signature. There also remains the question as to whether the Governor would sign the bill  even if it did pass.  I don’t imagine this is coming as a surprise to most people reading this.  Representative Chris Ross (Chester) and Senator David Argall (Berks etc.) deserve our appreciation for trying to overcome the leadership void and move the bill. 

So what does that mean for PASEIA?  We know people have lost their jobs in solar and are trying to find new ones, diversify their skills so they can stay in Pennsylvania or have decided to move their business elsewhere, at least until the market catches up here.  PASEIA will still seek opportunities to promote solar in 2013 and beyond although for the time being only through non-legislative avenues.  In the meantime, it’s election time in Pennsylvania and the nation and everyone is aware the Presidential race is on but many are unaware that all of the state House and one-half the Senate are up for re-election.  Has your legislator supported solar and PASEIA’s efforts to save solar in Pennsylvania? 

Also now is a good time to help shape PASEIA’s agenda for 2013-14.  Don’t let them win.  Stay involved.  Creative thinking will be needed to carve out opportunities, even small victories help keep solar going despite the set-back.

One thing we are very excited about is that very soon MSEIA/PASEIA will be releasing a detailed report on the Benefits of Solar in New Jersey and Pennsylvania, by Richard Perez, Ben Norris and Tom Hoff - prepared by Clean Power Research.  This study will be invaluable as we use it to educate legislators, public officials and the general public of the quantitative value of implementing solar PV technology, which results in a huge impact to rate payers and tax payers in both states.

Maureen Mulligan and Ron Celentano

HB1580 Status - Still At a Standstill........

The Pennsylvania House is in the final days of negotiations before breaking for the summer.  Republican leadership is divided on whether to run the solar bill with House Speaker Sam Smith agreeing to run the bill and House Majority Leader Mike Turzai refusing to run the bill.  We are at a stand-still and they are likely to be in Harrisburg for to up one more week in order to pass the budget along with Governor Tom Corbetts’s give-away to Shell Oil.   He is going to bat for a multi-national, non-US company but won’t save our solar jobs for a fraction of the cost. 

On the positive side, Senator David Argall (R-Berks and points north and west) introduced his senate version of HB #1580 known as SB#1350 this week.  We are currently awaiting committee assignment.  This will position us for the short legislative session in the fall if nothing happens before they break.  Please send a quick note to Senator Argall and thank him for his support of solar.  dargall@pasen.gov

Ron Celentano

PASEIA President 

To answer the question: is HB 1580 dead?

The answer is “no”, far from it.  We have been working hard to neutralize our opposition in an attempt to call a truce and drop their opposition to HB#1580.  We have been meeting regularly with members of the Consumer Affairs Committee and House leadership to bring up HB#1580 for a vote before the end of May.  We are making progress but we’re not quite there. 

Legislators are in their district offices the week of May 14^th and then back in Harrisburg May 21^st.  We are asking for a committee vote the week of May 21^st so it is very important you meet with or contact your House member and get them to ask Chairman Robert Godshall to bring it up for a vote before Memorial Day so there is enough time for the full House to vote and send it over to the Senate before summer recess.  Remind them that there are 108 co-sponsors.  If your Representative is one of the co-sponsors, it is even more important they ask Representative Godshall to vote it out of committee.  HB 1580 has been languishing in committee since the hearing was held on January 11, 2012.

After you make the request, it is important you follow up with them the week of May 21, 2012 if you haven’t seen anything from us that the vote has been scheduled.  We are coming to the finish line one way or another folks, and we need you to stay engaged and active.  Continue to read, check and respond to things we put out because we are running out of time and we can’t do it alone. 

Ron and Maureen and the PASEIA team

PASEIA Update from Harrisburg - HB1580

It’s been a little over two months since House Consumer Affairs Committee Chair Representative Robert Godshall (R-Montgomery) held a hearing on HB #1580. Since then, PASEIA and SEIA have been working with our chief sponsor, Representative Chris Ross (R-Chester) on a compromise amendment with the hopes of getting the bill voted on. First it has to go through Godshall’s Consumer Affairs Committee and ultimately be voted by the full House before it goes off to the Senate. At least, that’s the current plan. After two months of hard, hard work, we are beginning to see the fruits of our efforts but we are certainly not home yet. We have had a series of good meetings with the Chairman of the Public Utility Commission, Robert Powelson and several of the commissioners about the new compromise amendment. The amendment is the reason we are picking up a little momentum on the bill which until lately has been completely stalled. It is being seen favorably because it is addressing several of the concerns over the bill that we keep hearing over and over. The PUC chairman suggested another amendment but this time it is one I think we can (or should) all support. We are working to finalize that language and should have a final version later this week. The new amendment adds consumer protection language to the bill that would require solar developers to inform potential solar customers about the volatility of pricing SRECS. Since PASEIA’s code of conduct includes language about solar installers giving honest, accurate information on SREC pricing, this seems like a no-brainer.

Getting the PUC Chairman on board is a huge step forward for the industry and this wouldn’t have happened without the compromise that was crafted recently. We are also getting help for the Governor’s Energy staff. PASEIA completely understands that most of us would prefer to close the borders to out of state projects, but if we stayed with our original position, it was made crystal clear that the Governor would not sign the bill. Thanks very much to the solar folks for continuing to support PASEIA in this difficult negotiation. A legislative victory will help us work from a position of strength in other government arenas going forward .

We’ve also been working on the Senate side, meeting many of the senators and their staff, and getting them up to speed with Sen. Argall’s SB1350, as well as HB1580 – to date, we have 18 Senators in support of the bill. The main difference between Ross’ bill and Argall’s bill is the closing of the borders language – SB1350 still includes that language.

We are not asking members to take any particular action right now except if you haven’t paid your dues or followed through on your pledge to help us, it is vitally important you do so today. We need you to follow through on your commitments. We are asking others to do so. We are looking at a June horizon at this point and if we don’t succeed by the end of June, it is highly unlikely we will try again in the Fall. The legislature will be out most of April but we have the rest of March and the first week of April to continue to make progress before they break for the Primary. We are working both the House and Senate simultaneously right now but we’re not asking you to come out to Harrisburg at this point. We know your time is valuable so we are relying on our lobbyist and a few of the solar companies who have donated much time to this effort.

Our efforts don’t stop at the legislature or even the PUC. We are working with others including meeting with the PA Chamber of Commerce and the state Energy Association of PA who are long-time opponents of giving solar energy any “special treatment” (their language). We think we are making progress and should know more in the next few weeks. We are also hoping to re-energize the environmental community now that the Marcellus Shale impact fee has passed. We are beginning to talk to the unions. After all, jobs are involved and union members have also benefitted from solar.

As always, PASEIA needs your support in whatever way you can give it. If you can’t give time, give money. If you can’t give money, give of your time. There are always things to do to strengthen our position and our trade organizations. If you asked me a month ago if the bill would pass, I would have said the odds were getting slim, but this is a new day and things may be turning around. If they do, we’ll need your support. Hang in there. We are.

Please help us win this!! Contributions can be made on line at http://www.mseia.net

Maureen Mulligan and Ron Celentano

Saving Solar in PA Campaign
Crunch time for HB 1580

By Andrew Kleeman

House Bill 1580 (Ross-R, Chester County) was finally heard in House Consumer Affair Committee (Chair: Godshall-R, Montgomery County) on January 11, 2012. A link to the complete audio transcript of the Hearing will be available soon at the PASEIA/MSEIA web site - http://www.mseia.net/. You can also request a written transcript from any of the three PASEIA board members listed at the bottom of this email update. This update contains the following sections:

Member/Supporter Survey
Recent Developments
Impacts
Points of Opposition
What Now?

Member/Supporter Survey:

Please share just 2 1/2 minutes of your time with us to take our simple 10 question on-line survey. We are unable to move forward with lobby efforts without some input. Click to survey here: http://www.surveymonkey.com/s/JX7SPWX

Recent Developments:

In the weeks leading up to the 3^rd rescheduled Committee Hearing on 1-11-12, the Coal Lobby and the PA Chamber of Commerce chimed in as staunch opponents. The PA PUC also issued a split (3 to 2) opposition opinion. PECO and PPL also testified in opposition of the Bill. Chairman Godshall and most of the questioning Committee members were overtly more friendly to the opponent testimony. Conversely, all points of view were heard and the testimony from PASEIA and seven other heard proponents was compelling. We probably still have enough votes to pass this Bill, if we can get it out of Committee.

The political power of some of our opponents has diminished the inertia of the Bill. We have certainly lost some of the 111 co-sponsors and a few of the on-the-fence committee members. Rep. Ross and Sen. Argall remain committed to this Bill and it still has a real chance of passing, but we continue to face an uphill battle.

Impacts:

If this Bill fails, we (PASEIA) believe the PA solar industry is essentially dead until at least the summer of 2014. Currently, the state has 173 MW of systems which can trade SRECS (130 in state, 43 imported), against an RPS of only 44 MW. We are nearly 300% oversupplied at this time and the few PA SRECS that are trading are going for about $20 on the spot market.

Perhaps even more importantly, if our efforts fail, and the PA SREC market is truly collapsed, the event will send a cold chill through the finance community in all states where SRECs are an element of solar power system finance.

Points of Opposition:

The key points of opposition all revolve around this issues of (1) cost to ratepayers, (2) closing the borders, and (3) conceptual opposition to government subsidies for one specific form or energy.

With regard to the 1^st point (cost to ratepayers), we had already demonstrated that the effective cost of the RPS acceleration was less than a penny per day to a typical PA rate payer. We have now taken it even further: Rep. Ross is about to introduce an amendment to the Bill that credits the later years of the RPS with approximately the same number of SRECs that are to be debited in the next few years. In other words, we are now proposing to simply “borrow” the SRECs now from future years.

With regard to point (2), legal counsel from one of our members submitted a strong legal opinion on why closing the borders is NOT a violation of the federal Commerce Clause. Finally, with regard to point (3), we have attempted to illustrate the folly of this point, in deference to the reality that every form of energy, including fossil fuels is heavily subsidized – our subsidy is just more transparent and more easily measured. Our coalition partner, PennFuture did a terrific analysis of energy subsidies in PA – see http://www.pennfuture.org/media_pfr_detail.aspx?MediaID=1379#top

What Now?:

The next development will be introduction of the Ross Amendment – jsut this morning we recieved a final draft of the Amendment, and it should be formally released imminently. The Consumer Affairs Committee will then (hopefully) schedule a vote among its members. The outcome of that vote will define the subsequent steps.

At PASEIA, we are at an essential stand-still due to funding limitations. We wisely invested just over $50,000 in 2010 to get us to where we are today – exclusive of the value of the hundreds of hours donated by a relatively small member group.

While most of our larger members have made contributions at or above the $2,500 level, and many smaller company members have made $100 to $1,000 contributions, many in the PA solar industry have made no contribution at all. Even a dozen PA systems owners have made $25 to $500 contributions. Have you done your part?

If we are to continue our lobby efforts, and succeed, we need you financial support now. Please do what you can now – timing is critical. It would be a disgrace to have gotten so close to saving the PA solar industry and PA SREC market to loose it all now. Contributions can be made on line at http://www.mseia.net/ (see “PA Donate” button top right of page), or by contacting any of the following Board members to request in invoice from which to pay:

Ron Celentano CelentanoR@aol.com
Andrew Kleeman akleeman@mercurysolarsystems.com
Mike Newman mnewman@hallerent.com

Thank you

Ron, Mike, Andrew, and the entire PA Solar Industry