Feed In Tariff Coming to Sacramento? Hey, we should do this everywhere in California!

Sacramento California Solar News – Feed-in-Tariff coming to Sacramento soon. Whats a feed-in-tariff? A “feed-in tariff” is a public policy designed to encourage the adaption of sustainable energy such as solar. It has three key components the first of which is guaranteed access to the grid. It also needs long term contracts for the electricity produced and purchase prices that are based on fair market rates. That already exists for commercial solar farms but not for small solar systems. For a number of reasons, there is a great need to support renewable electricity in general and solar Photovoltaic (solar) electricity in particular in this country and in California that are imbedded in jobs and our national security policies.

The success story of solar deployment in Germany speaks for itself. Germany has one of the simplest feed-in tariff systems in the world. Feed-in tariffs are the driver of high-quality solar electricity systems. Many solar electricity support programs are based on an investment subsidy in order to reduce the barrier of high up-front capital costs. The drawback of such an approach is the missing incentive to invest in high quality solar electricity systems and to ensure their efficient operation and maintenance. If the customer receives a fixed payment per installed capacity unit, there is no incentive to go for high-quality products, which usually means a higher price, or to operate the system at the highest possible level. With the feed-in tariff the return on investment is heavily dependent on the performance of the solar system. The customer gets his return on investment with each kWh that is fed into the grid. Therefore maximizing the power output of the solar system over its whole lifetime is essential to the customer, ensuring that the solar system will be well operated and maintained. Read More

From NY Times – Variations on the policy that jumpstarted Germany’s decade-long boom in rooftop solar systems are taking root in more cities in the United States.

The policy, called a feed-in tariff, offers small-scale residential producers of solar energy long-term contracts (usually at above-market rates) for the electricity they sell. Last week, the Sacramento Municipal Utility District, which serves 1.4 million people, approved a feed-in tariff that allows residential Sacramento homeowners with solar panels a chance to sign up for 10, 15 or 20 years of guaranteed payments. The policy will take effect next January. The city of Gainesville, Fla., adopted a feed-in tariff this spring, as did Vermont. Washington state also has such a policy, and Hawaii is currently considering one.

While feed-in tariffs are most closely associated with solar photovoltaic panels, utilities managing the programs in Vermont and Sacramento will also pay a set price for electricity generated from other renewable energy sources, like wind.

The Sacramento program is open to homeowners who are not participating in another program, called net metering, which allows anyone whose system is producing more electricity than they need to sell the excess back to the utility, thus reducing their electric bill. But once their bill falls to zero, the residential homeowner gets no more money from the system.

Jon Bertolino, a spokesman for the Sacramento California utility, said that customers with land to spare had been asking whether, if they put up small solar farms, the utility would buy the excess electricity.

As long as they are not part of the net-metering program and not seeking the $2.80 $1.90- to $2.20 per watt ratepayer subsidy for their new panels under the state’s “Million Solar Roofs” program, Mr. Bertolino said, small generators can sell their power to S.M.U.D. (Sacramento Municipal Utility District) The rates would depend on the time of day the power is generated, ranging from a low of 5 or 6 cents a kilowatt-hour to 30 cents on a hot summer afternoon; the size of eligible systems is capped at 5 megawatts (and the program overall has a 100-megawatt cap).

The Vermont law caps the size of individual systems at 2.2 megawatts. Solar energy fetches a fixed price of 30 cents a kilowatt-hour, and other forms of renewables fetch lower rates.