As much as solar installers in Colorado would like the citizens of this state to believe it, the sun is not setting on the solar industry here.
The dire predictions of jobs being cut as early as next week are similar to the cries they made in 2009 when Xcel Energy requested a change to the Solar Rewards program to step down the incentive program as solar installation prices decreased and the industry grew. Despite those predictions, the industry grew 91 percent last year alone, according to the solar installation trade association.
What is lost in the cries and protests from the solar industry is the basic purpose of the Solar Rewards program. In 2006, Xcel Energy created the program to comply with Colorado’s renewable energy standard and, more specifically, the customer-sited solar portion of that state requirement. Solar Rewards is also a way to jump-start the solar industry and increase the amount of renewable energy available to Xcel Energy’s 1.3 million electric customers, who all pay in to the program through a 2 percent renewable energy standard adjustment on their electricity bills.
The program was never meant to be the lifeline of the industry. Our proposed changes rebalance cost-sharing, moving back from covering up to 75 percent of on-site solar costs (together with federal tax credits) to a 50 percent share, what we originally targeted and believe is a fair and reasonable share.
With an infusion of $178 million from Solar Rewards into the industry through 2010, solar installers have benefited from money to not only start their businesses, but to attract customers, too.
We hope jobs are not cut. There were already 2,200 systems approved for installation from last year and set to be completed this year. Add the systems to cover the already approved 6 megawatts ($12.3 million) of solar power approved so far this year and that’s six on-site systems potentially completed a day, every day for 365 consecutive days.
After the Colorado Public Utilities Commission rules on our proposed changes to the Solar Rewards program, potentially another 10 megawatts ($6.7 million) will need to be installed. In all, we anticipate the solar industry will see a total of $97 million in incentives and rebates.
Even now, while we are awaiting PUC review and potential approval of our changes, some solar installation companies are taking innovative steps by offering incentives of their own to potential customers. They are looking for opportunities to keep their businesses stable, their sales moving forward and their workers employed. Is that not what all businesses have to do — plan for the future, including a future that has economic challenges?
Some in the solar installation community say the proposed changes to the Solar Rewards program are a departure from voters’ desires expressed through the passage of Amendment 37. To the contrary, Solar Rewards has been a success in growing the solar industry and the adoption of renewables, leading to a new renewable energy standard last year of 30 percent by 2020. It’s a goal we’re working hard to meet.
Solar installation leaders want a third party to manage the Solar Rewards program, yet don’t say what they hope to accomplish other than keep the rebate and incentive program where it was prior to Feb. 16.
The sun is not setting on the solar industry in Colorado. We continue to reach out to installation companies and to their trade organization to help develop a sustainable program for Colorado. While other cities and states have seen a complete end to similar incentive and subsidized programs, we are looking at ways to responsibly manage the program and wisely use our customers’ funds to create a clean energy future at a reasonable cost. It’s time to roll up our sleeves, work together and craft an approach for solar energy in Colorado that benefits all customers.
Karen Hyde is vice president for rates and regulatory affairs at Public Service Company Colorado, an Xcel Energy company.
