State Solar Policy: 200809 Developments

1
State Solar Policy 2008-09 Developments
Current Trends

• Justin Barnes
• N.C. Solar Center
• N.C. State University
• NESEA Building Energy
• March 12, 2009

2
NESEA is a Registered Provider with The American
Institute of Architects Continuing Education
Systems. Credit earned on completion of this
program will be reported to CES Records for AIA
members. Certificates of Completion for non-AIA
members will be mailed after the
conference.This program is registered with the
AIA/CES for continuing professional education. As
such, it does not include content that may be
deemed or construed to be an approval or
endorsement by the AIA of any material of
construction or any method or manner of handling,
using, distributing, or dealing in any material
or product. Questions related to specific
materials, methods, and services will be
addressed at the conclusion of this presentation.
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Focus Learning Objectives

• Recent Federal Policy Changes Implications
• Four Pillars Updates
• - RPS, Net Metering, Interconnection, Incentives
• Innovative Policy Mechanisms
• - Property tax financing, Community NM, Next
  Generation Funding, Solar Renewable Energy
  Certificates (SRECs).

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The DSIRE Project
Database of State Incentives for Renewables
Efficiency

• Created in 1995
• Funded by U.S. DOE
• Managed by NCSU works closely with IREC
• Project Scope policies/programs that promote
  RE/EE
• Breakdown of Data 1,950 total records825
  solar records750 PV records

• www.dsireusa.org

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The Solar Alliance www.solar-alliance.org/mode
l_policies
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Federal Update
Commercial Solar ITC (10/08)

• Extended to 12/31/2016
• May be used to offset AMT
• Extended to utilities

Commercial Solar ITC (02/09)

• Grants in lieu of tax credit for COMMERCIAL
  TAXPAYERS. The grants are equivalent to 30 of
  the installed cost and are available through
  2010.

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Federal Update (contd)

• Residential Solar Credit (10/08)

• Extended to 12/31/2016
• 2,000 cap removed for PV (1/1/2009)
• May be used to offset AMT

Other Federal Incentives

• Tax Credit Bonds CREBs (2.4 B) and QECBs (3.2
  B)
• Bonus Depreciation Extended through Dec. 31,
  2009 (02/09)
• Subsidized Energy Financing 100 haircut
  repealed (02/09)
• Manufacturing Tax Credit 30 of investment,
  competitive, 2.3 B (02/09)
• Residential Solar Credit 2,000 cap on SHW
  removed (02/09)

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State Developments, 2008-09

• Rebates (new) CO (local), CT (PV), MA (PV), MN
  (SWH), NH, OH (residential PV SHW reactivated),
  PA (coming soon??)
• Tax credits (new/improved) GA (35), KY (small),
  OR (limit doubled), PA (15), VT (30), PR (75)
  
• Property tax incentives AZ, FL, MD, NC, NJ, NY
• Finance NJ (Loans/Contracts), MD (Contracts), CA
  (Berkeley First)
• New RPS/RPG OH, MI, MO, SD, UT
• Revised RPS/RPG D.C., IL, MA, MD, NH (minor)
• Solar RPS D.C., OH, MI, MA, MO
• Net Metering (improved) AZ, CO, CT, D.C., FL,
  HI, IL, KY, LA, MA, MI, NY, OH, RI, UT, VT
• Interconnection Standards (new/improved) CO,
  D.C., FL, IL, KYMD, MI, NC, NM, NY
• Solar access (improved) CA, CO, FL, MD, VA

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State Financial Incentives for Solar

• Direct Incentives
• Rebates (19/24)
• Grants (20/29)
• Production Incentives (3/3)
• Tax Credits/Deductions/Exemptions (27/58)
• Low-Interest Loans (27/31)
• Sales Tax Exemptions (22/23)
• Property Tax Incentives (30/40)
• Industry Recruitment Incentives (13/19)

( of states / of programs)
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www.dsireusa.org February 2009
State Financial Incentives for Solar
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Direct Incentives for PV, 1997
www.dsireusa.org
10-20 up to 75K
50 up to 10K
Varies by project
2K - 10K
10K - 50K
60K - 1M
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State Rebates PBIs for PV
February 2009
ME 2K max
15 - 54/kWh

• 19 state rebate programs PBIs
• 28 state grant programs (not shown on map)
• 29 non-state PBIs (not shown on map)
• 77 utility rebate programs (not shown on map)

NH 3/W
2-2.25/W
VT 1.75-3.50/W
MA 1-4.40/W
NY 2-5/W
1-2.25/W
CT 2.50-4/W
35
50, 3k max
NJ 1-1.75/W SRECs 0.42/kWh
30
2.30-4.60/W
3.50/W
DE 50
3.25/W 50/kWh, 5 yrs.
MD 2.50/W
2-3/W
4/W
Includes RPS-inspired utility rebate programs
in AZ, CO NV
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Federal Policy Implications
4.00/W

• Residential Cap Removal State Incentive
  Reductions (NJ, NY, CO, CT, MA, MD?)
• Consideration in other states
• Over-subscription, boom/bust cycle is also a
  factor

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www.dsireusa.org

February 2009
State Tax Credits for PV
VT 30 (C)
35
15
3/W (R) 50 (C)
25 (R)
MA 15 (R)
100 Deduct. (R)
RI 25
25 (R) 10 (C)
500 (R) 1K (C)

• Credits in 18 states P.R.
• Range 10 - 75
• FL, IA, MD, OK have small PTCs (not shown on
  map)

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25 (R)
30 (Non-Corp.) 2.7/kWh 10 yrs. (C)
10 (NR)
25
35
50
10 Deduct. (C)
35
P.R. 75
(R) Residential (C) Commercial (NR)
Non-Residential
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Property Tax Incentives

• Tax Credits NYC, numerous counties in Maryland
• Removal of subsidized energy financing haircut.
• Innovative Financing Berkeley First model

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State Regulatory Policies

• Public Benefits Funds (16DC ME)
• Renewables Standards/Goals (28DC 5 goals)
• Net Metering (40 D.C.)
• Solar Access Laws/Easements (35)
• Contractor Licensing (9)
• Equipment Certification (3 P.R.)

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Public Benefit Funds for Renewables
www.dsireusa.org


March 2008
VT 6.6M in 2008 34M from 2004-2011
MT 750,000 in 2008 8.3M from 1999-2009
ME voluntary contributions 411,000 from
2002-2008
MN 16M in 2008 264M from 1999-2017
MA 25M in 2008 525M from 1998-2017
MI 1.7M in 2008 25M from 2001-2017
OR 12M in 2008 182M from 2001-2017
RI 2.2M in 2008 38M from 1997-2017
WI 5.5M in 2008 97M from 2001-2017
CT 24M in 2008 435M from 2000-2017
IL 5.5M in 2008 99M from 1998-2015
NY 9.5M in 2008 114M from 1999-2011
OH 3.2M in 2008 63M from 2001-2010
CA 331M in 2008 4,149M from 1998-2016
NJ 102M in 2008 637M from 2001-2012
PA 950,000 in 2008 63M from 1999-2010
DE 3.5M in 2008 49M from 1999-2017
D.C. 400,000 in 2008 5.1M from 2004-2017
Denotes funds that do not have defined
expiration dates and do not require future
reauthorization or budgetary approval in
order to continue operations. (These funds are
not scheduled to expire in 2017.)
16 state funds DC and ME 6.8B by 2017 (est.)
The Oregon Energy Trust is scheduled to expire
in 2025.
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Non-PBF Renewable Funds

• AK Energy Authority 100 M (FY 2009),
  appropriated, utility-based, end-use
• IA Power Fund 75 M through 2011, focused on
  RD and commercialization
• OH Air Quality Development Authority 84 M
  through 2012, funded by state bonds
• PA Energy Independence Fund 650 M, broad based,
  funded by state bonds.
• WI Energy Independence Fund 150 M for grants
  and loans over 10 years.

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Regional Greenhouse Gas Initiative (RGGI)

• 09/08 38.6 M
• 12/08 106.5 M
• 03/09 ??
• 500 M possible for remaining 2009 allowances.

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www.dsireusa.org
Renewables Portfolio Standards, 1997
ME 30 by 2000
MN 425 MW by 2002
MA (under development)
NV 1 by 2009
IA 105 MW by 1999
AZ 1.1 by 2007
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DSIRE www.dsireusa.org


February 2009
Renewables Portfolio Standards
ME 30 by 2000 10 by 2017 - new RE
MN 25 by 2025 (Xcel 30 by 2020)
VT (1) RE meets any increase in retail sales by
2012 (2) 20 RE CHP by 2017
WA 15 by 2020

• NH 23.8 in 2025

WI requirement varies by utility 10 by 2015
goal
ND 10 by 2015

• MA 15 by 2020 1 annual increase(Class I
  Renewables)

MT 15 by 2015
OR 25 by 2025 (large utilities) 5 - 10 by
2025 (smaller utilities)
MI 10 1,100 MW by 2015
RI 16 by 2020
SD 10 by 2015
CT 23 by 2020

• NV 20 by 2015

IA 105 MW
UT 20 by 2025

• NY 24 by 2013

• OH 25 by 2025

• NJ 22.5 by 2021

IL 25 by 2025
CA 20 by 2010

• CO 20 by 2020 (IOUs)
• 10 by 2020 (co-ops large munis)

• PA 18 by 2020

• MO 15 by 2021

• MD 20 by 2022

• NC 12.5 by 2021 (IOUs)
• 10 by 2018 (co-ops munis)

• AZ 15 by 2025

• DE 20 by 2019

• DC 20 by 2020

• NM 20 by 2020 (IOUs)
• 10 by 2020 (co-ops)

VA 12 by 2022
TX 5,880 MW by 2015
HI 20 by 2020
28 states have an RPS 5 states have an RE goal
State RPS

• Solar hot water eligible
• Minimum solar or customer-sited RE requirement
• Increased credit for solar or customer-sited
  RE
• Includes separate tier of non-renewable
  alternative energy resources

State Goal
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DSIRE www.dsireusa.org February
2009
Solar/DG Provisions in RPS Policies
LBNL Estimate 7,656 MW in
2025
WA double credit for DG
NH 0.3 solar electric by 2014
MA TBD by MA DOER
MI triple credit for solar
NV 1 solar by 2015 2.4 to 2.45 multiplier for
PV
NY 0.1542 customer-sited by 2013
CO 0.8 solar electric by 2020
NJ 2.12 solar electric by 2021
PA 0.5 solar PV by 2020
OH 0.5 solarby 2025
DE 2.005 solar PV by 2019 triple credit for PV
UT 2.4 multiplier for solar
MO 0.3 solar electric by 2021
MD 2 solar electric in 2022
DC 0.4 solar by 2020 1.1 multiplier
for solar
NC 0.2 solarby 2018
AZ 4.5 DG by 2025
NM 4 solar electric by 2020 0.6 DG by 2015
State RPS with solar/DG provision
TX double credit for non-wind(non-wind goal
500 MW)
State renewables goal with solar/DG provision
Solar water heating counts towards solar
set-aside
DG Distributed Generation
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Largest RPS Markets for Solar (2009) AZ, NJ,
NV, and CO
Source LBNL Environmental Energy Technologies
Division / Energy Analysis Department
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RECs and SRECs

• Who owns them? How can you use them?
• - LBNL (04/06) 11 states address ownership ( 2
  pending at the time)
• - DSIRE (02/09) 23 states address ownership, of
  12 new policies, 9 to customer-generator.
• Bundled or Unbundled (e.g., CA)
• Innovative Programs
• - Xcel solar rebates SREC purchase, PSEG (NJ)
  Solar Loan, NJ SREC contracts, MD SREC contracts.

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Interconnection Standards

• Technical issues include safety, power
• quality, system impacts. Technical
• issues largely resolved.
• Policy issues include legal and
• procedural considerations. State
• approaches vary widely.
• Best policies adopted by IL, NJ, PA, NM,
  MD.

IREC model www.irecusa.org/index.php?id87
Freeing the Grid 2008 www.newenergychoices.or
g
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Net Metering

• Allows customers to store any excess electricity
  generated, usually in the form of a kWh credit,
  on the grid for later use.
• Available statewide in 39 states. State
  policies vary dramatically.
• Best policies adopted by CO, MD, FL, NJ, OR.

IREC model www.irecusa.org/index.php?id88
Freeing the Grid 2008 www.newenergychoices.or
g
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Net Metering (February 2007)
www.dsireusa.org


Only 5 States with 1 MW Net Metering
NH 25 MA 60 RI 25 CT 100
100
VT 15/150
100


100
50

40

25
10/400
30
20

25/100

25


no limit
500
PA 50/1,000/2,000 NJ 2,000 DE 25 MD
500 DC 100 VA 10/500

40



150


25
2,000
10
25

1,000
15

20/100

100
25/100

10
10/100
80,000

50
25/100
10
50
Net metering is available in 41 states D.C.
State-wide net metering for all utility types
State-wide net metering for certain utility
types (e.g., IOUs only)

Net metering offered by one or more individual
utilities
s indicate system size limit (kW) in some
cases limits are different for residential and
commercial as shown
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Net Metering
DSIRE www.dsireusa.org

February 2009
NH 100 MA 60/1,000/2,000 RI
1,650/2,250/3,500 CT 2,000
100
VT 250
100


100
50

40
25/2,000


20

25/100

20
NY 25/500/2,000 PA 50/3,000/5,000 NJ
2,000 DE 25/500/2,000 MD 2,000 DC
1,000 VA 10/500NC 20/100

25

500
No limit
25

1,000


2,000
25
40
10


25/2,000
1,000
100
co-ops, munis 10/25
30



80,000
100
25/300
20/100

No limit
10/100
20
FL 2,000
100
LA 25/300
(KIUC 50)
Net metering is available in 44 states D.C.
State-wide net metering for all utility types
State-wide net metering for certain utility
types only (e.g., investor-owned utilities)

Net metering offered voluntarily by one or more
individual utilities
Note Numbers indicate individual system size
limit in kilowatts (kW). Some states limits vary
by customer type, technology and/or system
application this is the case when multiple
numbers appear for one state. Other limits may
also apply. For complete details, see
www.dsireusa.org.
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Net Metering Meter Aggregation/Community Net
Metering

• Aggregation OR, WA, PA, ME, VT, RI
• Community NJ, CA, MA, VT
• Proposed VA, CO

Could make participation more flexible and
help achieve DG goals at a lower cost BUT
community net metering poses numerous of policy
questions for regulators (e.g., definition of
community, program limitations).
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Solar Access Laws

• 14 states limit or prohibit
  restrictions that neighborhood covenants
  and/or local ordinances may impose on the use
  of solar-energy systems.

(Solar easements allow for the rights to existing
solar access on the part of one property owner to
be secured from another property owner whose
property could be developed in such a way as to
restrict the solar resource. Transferred with
property title. Many other states allow these.)
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In Conclusion

• State trends
• Dominance of RPS
• Super-sized net metering
• Interest in FITs/PBIs
• Property Tax Vehicles
• State/Federal Interaction

Room for Improvement Incentives for
non-taxpayers Utility rate structures REC-selling
opportunities Market coordination
Wild cards Federal RPS? Credit markets? State
budgets? Electricity rates? Technology
breakthroughs?
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QUESTIONS??
This concludes The American Institute of
Architects Continuing Education Systems Program
Northeast Sustainable Energy Association
33
Contact
Justin Barnes N.C. Solar Center N.C. State
University justin_barnes_at_ncsu.edu
www.dsireusa.org919.513.0792
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S lar P rtal
Coming soon

• Solar-Specific Incentive Information
• Clickable U.S. Map for Quick Access to PV
  Incentives
• PV Incentive Summary Maps
• State-by-State Incentive Comparison Tables
• Tax Credits, Rebates, Solar Portfolio Standards,
  Net Metering
• PV Incentive Program Installation Data from IREC
• of Installations, Incentive Expenditures,
  Capacity Installed
• Solar Policy Guide

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Excerpt from State PV Rebate Comparison Table
D R A F T
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Most Aggressive RPSs, Required Solar as of Sales
California goal of 3,000 MW equals 1.5
Source LBNL Environmental Energy Technologies
Division / Energy Analysis Department
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(No Transcript)
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Solar Capacity Resulting from RPS Solar Policies

• 2005 Outlook 1,000 MW
• 2006 Outlook 2,700 MW
• 2007 Outlook 6,000 MW
• 2008 Outlook 7,550 MW
• Largest markets
• NJ (1500 MW)
• MD (1500 MW)
• AZ (1000-1500 MW)
• PA (850 MW)