Increasing photovoltaics in Illinois

To establish itself in the marketplace, solar electricity (PV, or ”photovoltaics”) needs steady, consistent support from communities and government. Fluctuating funding levels and uncertain government policy make business planning difficult and expensive. In contrast to the U.S., China, Japan, Germany and other countries develop long-term strategic plans, funded at predictable levels. This helps their industries develop more quickly and set predictable manufacturing schedules for output, business growth and job creation. Although the U.S.’s PV has increased, its growth rate fell behind more dramatic increases in other countries. Five years ago, the United States accounted for 65 percent of the world’s manufacturing capacity; now we only account for 35 percent. Four years ago, the world’s productive capacity was 250 MW. Today, Sharp of Japan’s capacity alone exceeds 250 MW/year. Japan took over from the U.S. in leading photovoltaic production in 1998. Germany is threatening to overtake the U.S. for second place in PV production. This pattern has been repeated in wind power production and installation, as the U.S. fell behind Germany, then Spain and Denmark and is in further danger of falling behind other European and Asian countries. Consistent and ambitious policies encourage new, multi-billion dollar renewable energy industries supplying tens of thousands of high-paying jobs. While PV serves only a small portion of our nation’s electrical needs, the market has been growing 25 to 30 percent over the last few years. When even a few percent of the population use PV, its growth rate will be exponential, making a dramatic impact on the marketplace. The United States needs stable, predictable government programs to recapture the lead in producing PV modules. Illinois needs other policies, including a statewide program of interconnection and net metering that is consistent and reasonable. Producers of renewable energy anywhere in the state should be able to connect to the grid and sell excess electricity at the same price they are charged. Commonwealth Edison’s service area already enjoys one of the best such policies and practices of any investor owned utility in the U.S. We also need a meaningful renewable energy portfolio standard to provide a target for ensuring orderly development and strategic support for all renewable energy technologies. A program to install renewable energy systems on public buildings would increase public awareness and provide emergency power when grid service fails and vital public services are jeopardized. During storms or times of prolonged hot spells, public buildings would serve as emergency cooling centers. As of today, less than 1/10 of 1 percent of Illinois’ electrical needs is met by PV. Meeting 1 percent of Illinois’ electrical needs with PV would require the electrical production of a large power plant. In 2002, global PV production capacity reached the annual rate of a medium-sized power plant. Expanding capacity is essential to lower costs, which broaden the market for solar and provide a competitive advantage. This is demonstrated by world wind power production that is now approaching a large power plant every two weeks. Some misconceptions regarding PV must be overcome to expand its use. First is the concept that large-scale PV usage would require enormous unused land areas. An example that’s brought out is the 10,000 square mile area in Nevada that is needed to meet all the electrical needs of the country. That in itself is not a significant area compared to space available in the western U.S. The bigger present issue is one of transmission. But that ignores the basic strength of PV in that its installations are most efficient when placed near their point of use and integrated into buildings as roofs, facades and windows, or along rights of way like railroad lines and utility lines, or on abandoned industrial sites such as brown fields. A National Renewable Energy Laboratory study found that using such existing land areas can supply U.S. electricity needs without using “virgin” lands. Another misleading question raises the concern of how many years are required for a PV installation to repay its “energy” costs. The energy input for an installed PV system that will generate 20-30 years (or more) of electricity takes about 2-3 years of consumption. If the same question were asked about the homes we build, the cars we drive or the miles we travel, or the “conventional” power plants built, we could not afford any of them from an energy standpoint. The question of “payback” is strategically shortsighted and ignores all the societal benefits the society derives from purchases of PV, including long-term economics and security. Any government support of renewables is necessary to internalize the social and environmental costs of conventional energy sources. To paraphrase a saying, “free markets” tend to be a lot hotter cooked than eaten. Up-front cost of the systems must be put in perspective. At the time of installation, a homeowner buys 25 to 30 years of electrical service. PV systems can be paid by home mortgages just like refrigerators, water heaters and other appliances. In California, homes with PV systems are beginning to realize economic benefits. In central California, where that state’s electric prices are not toward the high end, homes with PV systems are selling faster at prices that reflect the value of the systems—$20,000 or more. Homes with lower utility bills tend to sell faster and at higher prices. Since PV systems are long-term investments and future energy prices are uncertain, it is myopic to judge the value of a system based on today’s cost for a kilowatt of electricity. Electric prices are on track to be fully deregulated in 2007. Then the cost of electricity may reflect the higher costs associated with peak power as well as its overall cost. We have already seen this with a deregulated natural gas market. According to figures from the U.S. Energy Information Agency, nearly 60 percent of Illinois electric utility natural gas usage is used for cooling purposes in July and August. PV could reduce peak demand and help limit expensive price spikes. Increasing demand, shipment and storage costs for natural gas supplies will inevitably result either in price increases to consumers or subsidies paid by taxpayers. PV systems provide their outputs at largely the same time periods as highest peak power demands. Any supplementation of electrical demand by PV should lower the cost of electricity from natural gas. With global trends expanding the manufacturing capacity for PV, a dramatic increase in the use of the technology appears assured. The major question for the United States and Illinois is whether we will produce the technology, or buy it from other nations and let them reap the economic benefits of another technology originally nurtured with American tax dollars. For Illinois to benefit from the solar revolution, we need enlightened and stable state policies to support a transition to renewable energy. Based on a presentation by Mark Burger, sales manager of Spire Solar Chicago and president of the Illinois Solar Energy Association, presented at the Second Annual Illinois Renewable Energy Fair, Aug. 9, 2003, Oregon, Ill.

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