NewEnergyNews: TODAY’S STUDY: Where Solar Isn’t Growing and Why


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    Monday, May 02, 2016

    TODAY’S STUDY: Where Solar Isn’t Growing and Why

    Throwing Shade; 10 Sunny States Blocking Distributed Solar Development

    Greer Ryan, April 2016 (Center for Biological Diversity)

    Executive Summary

    In order to avoid the worst impacts of climate change, it’s clear that a rapid shift to a 100 percent renewable energy system is needed by mid-century – a move supported by leading climate scientists, industry experts, religious groups, justice organizations and environmentalists alike. Distributed solar energy plays a unique and critical role in creating a renewable energy future that stems climate change, promotes social justice and protects biodiversity, yet the expansion of this market in the United States relies in large part on state policies that determine whether solar panels are accessible and affordable.

    The 10 states with the best policy landscapes for supporting solar market growth, highlighted in a recent report by Environment America, have been driving the solar energy boom. In fact the installed solar capacity in these states accounts for 86 percent of the total for the United States. Unfortunately the vast majority of states are lacking the fundamental policies that would encourage solar market development; even worse, many are actively preventing it through policy barriers and restrictions. More than half of all states with key distributed solar policies in place saw efforts to weaken or eliminate those policies in 2015.

    For this report, we analyze and highlight 10 states that are blocking distributed solar potential through overtly lacking and destructive distributed solar policy. These 10 states — Alabama, Florida, Georgia, Indiana, Michigan, Oklahoma, Tennessee, Texas and Virginia — account for more than 35 percent of the total rooftop solar photovoltaic (PV) technical potential in the contiguous United States, but only 6 percent of total installed distributed solar capacity, according to a March 2016 report released by National Renewable Energy Laboratory (NREL) and data provided by the U.S. Energy Information Agency.2 3 All of these states have significant barriers in place to distributed solar development and have earned an overall policy grade of “F” in our analysis.4 We based these grades on a thorough review of the presence, or absence, and strength of key distributed solar policies, and, combined with the overall rooftop solar photovoltaic technical potential rankings by National Renewable Energy Laboratory (NREL), identified the states that would benefit most from improvements to their distributed solar policy landscapes.

    Of the 10 states highlighted in this report:

    • Seven are lacking mandatory renewable portfolio standards (RPS), policies that are key to creating a safe market for investing in rooftop solar. The three states with mandatory RPSs in place — Michigan, Texas and Wisconsin — have already met their low targets and have not taken steps to update their policies, so these RPSs are doing nothing to bolster the solar industry at this point. In fact Texas met its incredibly unambitious goal of 10,000 MW 15 years ahead of schedule and is unlikely to update this goal anytime soon.

    • Three lack mandatory statewide net-metering policies, possibly the most important policy model in place in the United States that allows for solar customers to connect with the grid. Only three other states in the country can say the same.

    • Only three allow for third-party ownership of solar panels — a financing model that has fostered a distributed solar boom across the United States by allowing for those who wouldn’t otherwise be able to afford solar panels outright to be able to install them on their property.

    • None have community solar programs in place, which are a key policy to encourage access to distributed solar resources and ensure community resiliency.

    • Nine lack strong interconnection laws, making the process of installing solar panels harder for homeowners, business owners and third-party companies alike.

    • Five don’t have any solar-access laws that protect home and business owners from local restrictions on solar panel installations due to issues such as neighborhood aesthetics.

    All 10 of these states are bad actors in the distributed solar policy game, but two in particular stand out as the worst: Florida and Texas. These two states fall in the top 3 for rooftop solar photovoltaic technical potential, just after California. Both Florida and Texas could feasibly have some of the best markets in the country for distributed solar growth; they make up more than 16 percent of the total technical potential for the contiguous United States. Because of bad policy landscapes, however, these states currently only account for 2.7 percent of the total installed distributed PV capacity in the United States.

    Conclusion: State policy landscapes that prevent the expansion of the distributed solar market threaten the swift transition from fossil fuels to a fully renewable energy system that’s needed to stave off the worst impacts of climate change and protect the health of communities and the planet. All 50 states should make improvements to their renewable energy policies in one way or another, but the 10 states identified as the top offenders when it comes to blocking distributed solar can have a significant impact on distributed solar progress — and therefore on environmental health, energy security and the climate crisis — by following the recommendations outlined in this report.

    What Is Distributed Solar?

    Generally, when people talk about distributed solar, they are referring to solar panels on rooftops of homes and businesses — but the term can refer to any kind of solar electric system that is placed on or near where electricity is used. Solar arrays are often found on building rooftops, of course, but some emerging technologies allow for solar cells to be incorporated onto other building surfaces, including as thin-film cells on windows. Solar panels as shades on parking lots, community solar farms and even individual solar panels on street lamps are all forms of distributed generation. Distributed solar generation is an important part of a sustainable energy future for many reasons. Reducing the distance between where electricity is generated and where it is used prevents energy loss in transmission, creates more ownership opportunity in the energy system for individuals and communities, and decreases the amount of land destroyed by large-scale energy operations.

    Key state-level distributed solar policies and barriers

    Unfortunately there is no clear model or silver bullet for distributed solar policy suites at the local, state or national level, although there are many expert opinions regarding individual model policies. Certain states have emerged as leaders in creating solar-friendly policy landscapes, including California, New York and Arizona. These leading states tend to have three categories of key solar policies, as broken down by NREL:

    • Market preparation policies allow for home and business owners to install solar panels on their property by creating the regulatory structure needed to connect small solar installations to the grid. Without these policies in place, the barriers are often too great for installation, regardless of how interested the property owner is. These policies include interconnection standards, net-metering and solar-rights policies.

    • Market creation policies set up the conditions needed for solar businesses to sell energy or technology to home and business owners. The main market creation policy model in the United States that influences distributed generation diffusion is the renewable portfolio standard (RPS), also known as a renewable electricity standard (RES). These set minimum requirements for renewable energy generation for utilities. RPSs that include specific minimum requirements for solar energy generation, or distributed generation, are said to have a solar carve-out.

    • Market expansion policies are those that help expand access to solar energy and technology to those who wouldn’t otherwise have access, such as renters or low-income homeowners. These include financial incentives such as grants, rebates, and tax incentives, community solar laws (including virtual net metering), and third-party ownership (TPO) laws.


    The distributed solar market is at a tipping point: The PV solar industry is booming, rooftop solar prices are becoming increasingly competitive with fossil fuel sources, and we know what policies work to encourage installations. While there are some federal policies that can influence distributed solar, the real power lies with the states, especially with the current divided political climate in Congress. We do have some real success stories to look to for inspiration: The distributed solar market has blossomed in California, Arizona, Hawaii, New York and other states that have adopted generally strong solar policies. Unfortunately, distributed solar development is under attack in most states. From netmetering fights to outright bans on third-party ownership, energy, climate, wildlife and economic and social justice advocates need to stand together to support positive distributed solar policies that can maximize our solar potential with minimal environmental impact and protect the rights of individuals and communities to create and benefit from clean, reliable energy where they live and work.

    The states outlined in this report are far from the only states that need to improve their policies — all 50 states could be improved in one way or another. What these states do represent is significant missed opportunity for clean energy generation, community resilience and empowerment, job creation, and wildlife protection through avoided habitat loss due to poorly sited utility-scale renewable energy sources. The lack of key solar policies and the presence of active barriers to distributed generation diffusion in these states are representative of policy issues many other states are dealing with or will likely be facing in the near future. The hope is that by outlining some of these issues — nonexistent, weak and disruptive policies alike — home and business owners, solar advocates and policymakers will have an easier time identifying ways to improve distributed solar policy in all states, and we can achieve the necessary transition to a just, wildlife-friendly and fully renewable energy system by 2050.

    For more information on policy models that can encourage distributed solar access, check out the recently released “Shared Renewable Energy for Low- to Moderate-Income Consumers: Policy Guidelines and Model Provisions” report by Interstate Renewable Energy Council and “Low-Income Solar Policy Guide: A road map to successful policies and programs creating access to solar technology and jobs nationwide” report by GRID Alternatives, Vote Solar and Center for Social Inclusion.


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