State Solar Policy: National and Southeast Policy Trends
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1 State Solar Policy: National and Southeast Policy Trends Amy Heinemann N.C. Solar Center / DSIRE N.C. State niversity NCSL Southeast Solar Energy Institute October 9, 2009
2 DSIRE Project Overview Created in 1995 Funded by DOE / NREL Managed by NCS; works closely with IREC Scope: government & utility policies/programs that promote RE/EE deployment > 2,100 total summaries DSIRE Solar
3 DSIRE Solar Interactive Policy Map: Provides quick access to state-specific solar information Solar Policy Guide: Offers descriptions of various state and local policy types for promoting solar; status and trends of individual policies; specific policy examples; and links to additional resources Summary Maps: Provide geographical overview of incentives across the country Solar Policy Comparison Tables: Highlight individual elements of state rebate and tax credit programs Search Function: Allows users to create a custom list of programs by solar technology, incentive type, eligible sector, etc.
4 Traditional Solar Policy Options State Financial Incentives Rebate Programs Production Incentives Corporate Tax Credits Personal Tax Credits Grant Programs Ind. Recruitment/Support Loan Programs Property Tax Incentives Sales Tax Incentives State Regulatory Policies Public Benefits Funds (PBFs) Renewable Portfolio Standards (RPSs) Solar/DG Carve-Outs Net Metering Interconnection Standards Solar Access Laws Contractor Licensing
5 Direct Cash Incentives for Solar Projects / September 2009 NH VT MA RI DC.S. Virgin Islands State Direct Cash Incentives for PV State Direct Cash Incentives for Solar Water Heating State Direct Cash Incentives for both PV and Solar Water Heating tility Direct Cash Incentive(s) for PV and/or Solar Water Heating 24 States + DC and Virgin Islands offer Direct Cash Incentives for Solar Projects
6 State Tax Credits for Solar Projects / September 2009 DC Incentives for Residential Projects Incentives for Commercial Projects Incentives for Residential and Commercial Projects Applies to Solar Electric only 21 States +Puerto Rico Offer Tax Credits for Solar Projects
7 OR: $13.8M in 2009 $191M from ** Public Benefits Funds for Renewables MT: $750,000 in 2009 $14M from * / May 2009 (estimated funding) MN: $19.5M in 2009 $327M from * WI: $7.9M in 2009 $90M from * MI: $6.7M in FY2009 $27M from * ME: 2009 funding TBD $580,300 from VT: $5.2M in FY2009 $33M from MA: $25M in FY2009 $524M from * RI: $2.2M in 2009 $38M from * CA: $363.7M in 2009 $4,566M from IL: $3.3M in FY2009 $97M from OH: $3.2M in 2009 $63M from DC DC: $2M in FY2009 $8.8M from CT: $28M in FY2009 $444M from * NJ: $78.3M in FY2009 $647M from NY: $15.7M in FY2009 $114M from PA: $950,000 in 2009 $63M from DE: $3.4M in 2009 $48M from * State PBF State PBF supported by voluntary contributions * Fund does not have a specified expiration date ** The Oregon Energy Trust is scheduled to expire in states & DC have public benefits funds ($7.3 billion by 2017) ME has a voluntary public benefits fund
8 WA: 15% by 2020* NV: 25% by 2025* CA: 33% by 2020 Renewable Portfolio Standards MT: 15% by 2015 OR: 25% by 2025 (large utilities)* 5% - 10% by 2025 (smaller utilities) T: 20% by 2025* AZ: 15% by 2025 NM: 20% by 2020 (IOs) 10% by 2020 (co-ops) / September 2009 ND: 10% by 2015 SD: 10% by 2015 CO: 20% by 2020 (IOs) 10% by 2020 (co-ops & large munis)* KS: 20% by 2020 MN: 25% by 2025 (Xcel: 30% by 2020) WI: Varies by utility; 10% by 2015 goal IA: 105 MW IL: 25% by 2025 MO: 15% by 2021 VT: (1) RE meets any increase in retail sales by 2012; (2) 20% RE & CHP by 2017 MI: 10% + 1,100 MW by 2015* NY: 24% by 2013 OH: 25% by 2025 WV: 25% by 2025* VA: 15% by 2025* NC: 12.5% by 2021 (IOs) 10% by 2018 (co-ops & munis) ME: 30% by 2000 New RE: 10% by 2017 NH: 23.8% by 2025 MA: 15% by % annual increase (Class I Renewables) RI: 16% by 2020 CT: 23% by 2020 PA: 18% by 2020 NJ: 22.5% by 2021 MD: 20% by 2022 DE: 20% by 2019* DC: 20% by 2020 HI: 40% by 2030 State renewable portfolio standard State renewable portfolio goal Solar water heating eligible TX: 5,880 MW by 2015 Minimum solar or customer-sited requirement * Extra credit for solar or customer-sited renewables Includes non-renewable alternative resources 29 states & DC have an RPS 6 states have goals
9 Renewables Portfolio Standards, 1997 MN: 425 MW by 2002 ME: 30% by 2000 MA (under development) NV: 1% by 2009 IA: 105 MW by 1999 AZ: 1.1% by 2007
10 RPS Policies with Solar/DG Provisions / September 2009 WA: double credit for DG OR: 20 MW solar PV by 2020; double credit for PV MI: triple credit for solar NH: 0.3% solar-electric by 2014 MA: TBD NV: 1.5% solar by 2025; 2.4 to 2.45 multiplier for PV T: 2.4 multiplier for solar AZ: 4.5% DG by 2025 CO: 0.8% solar-electric by 2020 NM: 4% solar-electric by % DG by 2020 IL: 1.5% solar PV by 2025 MO: 0.3% solar-electric by 2021 OH: 0.5% solar by 2025 WV: various multipliers NC: 0.2% solar by 2018 NY: % customer-sited by 2013 NJ: 2.12% solar-electric by 2021 PA: 0.5% solar PV by 2020 DE: 2.005% solar PV by 2019; triple credit for PV MD: 2% solar-electric in 2022 DC: 0.4% solar by 2020; 1.1 multiplier for solar TX: double credit for non-wind (Non-wind goal: 500 MW) State renewable portfolio standard with solar / distributed generation (DG) provision State renewable portfolio goal with solar / distributed generation provision 16 states & DC have an RPS with solar/dg provisions Solar water heating counts toward solar provision
11 Solar Set-Aside MW (2025) Rank % Retail Sales (2025) Rank AZ 1, % 3 CO % 11 DC % 10 DE % 5 IL 1, % 6 MD 1, % 4 MO % 13 NC % 14 NH % 12 NJ 1, % 2 NM % 1 NV % 7 NY % 16 OH % 9 OR % 15 PA % 8 Total 8, % Source: Lawrence Berkeley National Lab
12 Financial Incentives: Best Practices Stable, long-term incentive, declining over time Stable funding source Easy application process Administrative flexibility to modify program Cost-effective quality assurance mechanism Track program usage & share data Partnerships with banks, installers, nonprofits Education & outreach
13 Net Metering Customer stores any excess electricity generated, usually in the form of a kwh credit, on the grid for later use Available statewide in 42 states 18 states + DC allow 1 MW or greater IREC model rules: Freeing the Grid 2008, new report out late October
14 WA: 100 OR: 25/2,000* CA: 1,000* NV: 1,000* State policy MT: 50* T: 25/2,000* AZ: no limit* HI: 100 KIC: 50 WY: 25* CO: no limit co-ops & munis: 10/25 NM: 80,000* Net Metering / September 2009 ND: 100* NE: 25 KS: 25/200* MN: 40 OK: 100* WI: 20* MO: 100 AR: 25/300 LA: 25/300 MI: 150* IA: 500* IN: 10* IL: 40* KY: 30* OH: no limit* WV: 25 GA: 10/100 VT: 250 NC: 1,000* FL: 2,000* ME: 660 co-ops & munis: 100 NH: 100 MA: 60/1,000/2,000* RI: 1,650/2,250/3,500* CT: 2,000* 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: 20/500* 42 states & DC have adopted a net metering policy Voluntary utility program(s) only * PR: 25/1,000 State policy applies to certain utility types only (e.g., investor-owned utilities) Note: Numbers indicate system capacity limit in kw. Some state limits vary by customer type, technology and/or system application. Other limits might also apply.
15 Interconnection Standards Technical issues (safety, power quality, system impacts) largely resolved Policy issues (legal/procedural) improving IREC model rules: Freeing the Grid 2008, new report out late October
16 Interconnection Standards / July 2009 WA: 20,000 MT: 50* OR: 25/2,000* WY: 25* CA: no limit NV: 20,000 MN: 10,000 VT: no limit WI: 15,000 NY: 2,000 SD: 10,000 MI: no limit PA: 5,000* NE: 25* IN: no limit CO: 10,000 IL: 10,000 T: 25/2,000* KS: 25/200* MO: 100* KY: 30* OH: 20,000 VA: 20,000 NC: no limit NH: 100* MA: no limit CT: 20,000 NJ: 2,000* MD: 10,000 DC: 10,000 State policy HI: no limit NM: 80,000 TX: 10,000 AR: 25/300* LA: 25/300* GA: 10/100* SC: 20/100* FL: 2,000* 37 states + DC & PR have adopted an interconnection policy * PR: no limit Standard only applies to net-metered systems Notes: Numbers indicate system capacity limit in kw. Some state limits vary by customer type (e.g., residential/non-residential). No limit means that there is no stated maximum size for individual systems. Other limits may apply. Generally, state interconnection standards apply only to investor-owned utilities.
17 Solar Access Laws / June 2009 DC 18 states limit or prohibit restrictions that neighborhood covenants and/or local ordinances may impose on the use of solarenergy systems 33 states 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 14 states have provisions for both Solar Rights Provision Solar Easements Provision Solar Easements & Solar Rights Provisions
18 Average Residential Retail Rates, 2008 Source:.S. Energy Information Administration
19 Installed.S. PV Capacity (through 12/31/08) Source: / May 2009 Top 10 States 2007 (MW DC ) installations 2008 (MW DC ) installations Cumulative (through 12/31/08) California New Jersey Colorado Nevada Arizona New York Hawaii Connecticut Oregon Massachusetts
20
21 Emerging Trends Feed-in Tariffs States are moving away from traditional rebates to productionbased incentives Feed-in Tariffs (FITS) are one form of this. Producers paid at fixed rate based on generation cost and have long-term contract (10-20 yrs). Rate differentiated by size, technology, and application Buy-all, sell-all arrangement Around 20 states have considered in past 2 years. 3 states passed FITs, 2 through legislation, 1 with PC proceedings Handful of utilities created FITs in Florida, Wisconsin, and Michigan. Possible new utility FITs in Indiana and Texas.
22 Emerging Trends PACE Financing PACE financing = property assessed clean energy financing Also called property tax financing authorization, municipal energy financing districts This policy allows property owners to borrow money to pay for renewable energy and/or energy-efficiency improvements. The amount borrowed by a property owner is usually repaid through an increased property tax assessment over a period of years. In general, local governments that choose to offer property tax financing must be authorized to do so by state law. Prior to 2009, only 2 states had this authorization Currently, 16 states have enacted legislation to permit local government action, several other states already appear to have authority Does not affect state budget
23 Conclusions Trends/Issues Dominance of RPS policies Super-sized net metering Surging interest in FITs Rapid adoption of PACE financing New financial & policy models Calibrating state/federal policy Distributed v. centralized PV Increasing policy complexity Need for Improvement tility rate structures REC markets Incentives for non-taxpayers National market coordination Legal clarification: 3 rd party sales, PACE financing Bureaucracy
24 Contact Amy Heinemann N.C. Solar Center / DSIRE NCS, Box amy.heinemann@ncsu.edu
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