By Nichola Groom, Reuters
Solar power companies have an image problem—and they are beginning to do something about it.
Despite a sharp drop in the price of solar panels and innovative financing plans that have brought the technology to many middle income households over the past decade, it is still seen as a luxury only rich, mostly white, consumers can afford. That perception both hampers solar expansion in less affluent communities and drives political opposition to initiatives promoting greater use of solar power as a renewable alternative to gas, oil and coal.
Though it has grown dramatically in recent years, solar power still makes up less than 1 percent of U.S. energy supplies and relies heavily on government incentives to compete with traditional energy sources. Those incentives help companies such as SolarCity, Sunrun and others market solar power contracts that offer customers 20 percent savings on their energy bills. However, the schemes come with certain credit requirements and are ill-suited for apartment dwellers, homes with low monthly bills or low-income households that qualify for reduced power rates.
Since minorities make up a disproportionate number of low-income households, some advocacy groups have opposed certain solar power initiatives arguing that they deepen social and racial inequality. Solar companies are now trying to tackle both the perceptions and the economics by pushing to diversify their workforce, forging alliances with minority groups, and making solar power more suitable for multi-family housing.
The stakes are particularly high in California, by far the top U.S. solar market where solar power is expected to make up more than 10 percent of the state’s power generation in 2015, according to IHS. Communities with median household incomes below $40,000 account for just 5 percent of installations in the state even though a third of California households fall into that category. That share has not changed over the past seven years even as solar installations in communities in the $55,000-$70,000 income bracket have risen to more than half of the total market.
Read full article from Reuters
Opinion: The Phony Numbers Behind California’s Solar Mandate
By Steve Sexton, The Wall Street Journal
California’s energy regulators effectively cooked the books to justify their recent command that all homes built in the Golden State after 2020 be equipped with solar panels. Far from a boon to homeowners, the costs to builders and home buyers will likely far exceed the benefits to the state.
The California Energy Commission, which approved the rule as part of new energy-efficiency regulations, didn’t conduct an objective, independent investigation of the policy’s effects. Instead it relied on economic analysis from the consultancy that proposed the policy, Energy and Environmental Economics Inc. Its study concluded that home buyers get a 100% investment return—paying $40 more in monthly mortgage costs but saving $80 a month on electricity. If it’s such a good deal, why aren’t home buyers clamoring for more panels already? Most new homes aren’t built with solar panels today, even though the state is saturated by solar marketing.
The Energy Commission is too optimistic about the cost of panels. It assumes the cost was $2.93 a watt in 2016 and will decline 17% by 2020. Yet comprehensive analysis of panel costs by the Lawrence Berkeley National Laboratory estimated the average cost of installed panels to be $4.50 a watt for the 2- to 4-kilowatt systems the policy mandates. That is $4,000 more than regulators claim for a 2.6-kilowatt model system in the central part of the state, where 20% of new homes are expected to be built. Berkeley Lab further estimates that costs fell a mere 1% between 2015 and 2016, far short of the 4% average annual decline the regulators predict.
Now consider the alleged savings on energy bills. The commission’s analysis assumes California will maintain its net energy-metering policy, which effectively subsidizes electricity produced by a rooftop solar panel…
Read full op-ed in the Wall Street Journal