CALIFORNIA FEED-IN OPTIONS

RENEWED ENERGY: California Eyes Euro-Style Market For Solar
Cassandra Sweet, October 6, 2009 (Dow Jones Newswires via Wall Street Journal)

"California's solar-power market, the world's third largest, could be on the verge of [another] expansion…California's abundant sunshine, relatively high utility rates and solar subsidies have made rooftop solar [popular and]… the state's utilities have been signing contracts with large-scale solar farms…to meet stringent state requirements. What's been missing is a German-style market for small and medium-size solar generators to sell their output to utilities at above-market rates….in the form of feed-in tariffs.

"Two separate proposals aim to create a small-scale solar market in California that brings the benefits of the German market, such as distributed generation, which avoids the need for transmission because power is generated close to where it's used, minus the drawbacks, like excessively high payments that could become a burden on utility customers."

The California Energy Commission (CEC) recently weighed in on the feed in tariff. Click thru for complete KEMA presentation.

"The staff of the California Public Utilities Commission has proposed requiring the state's three large utilities, owned by PG&E Corp. (PCG), Edison International (EIX) and Sempra Energy (SRE) to collectively buy 1,000 megawatts of power from solar-panel generators sized between 1 and 20 megawatts, over four years. The utilities would accept bids for projects during periodic "reverse auctions" and pick the projects with the lowest bids…A separate proposal, in a bill the state legislature passed last month, would direct the CPUC to set a feed-in tariff that the state's utilities would have to pay for a total of 750 megawatts of solar power from facilities of 3 megawatts or less.

"Solar-panel makers are enthusiastic about the CPUC proposal, less so about the legislative measure. Allowing the solar market to set a competitive price, rather than requiring the government to set a price would attract more development and create a more robust market, said Julie Blunden, vice president of public policy and corporate communications at solar-panel maker SunPower Corp. (SPWRA)…Solar companies also say the pricing formula in the bill would set the feed-in tariff too low to attract development…[and] the bill's requirements might interfere with the CPUC's proposed program…"

The California Energy Commission (CEC) recently weighed in on the feed in tariff. Click thru for complete KEMA presentation.

"Supporters of the bill…said the legislative program wouldn't interfere with the CPUC's program and would complement it by focusing on smaller projects…Sue Kateley, executive director of the industry group California Solar Energy Industries Association, said the legislative program would capture lower-cost projects on rooftops of schools, local government buildings, farms and warehouses…[L]ocal governments aren't allowed to participate in competitive auctions and would be excluded from the CPUC program.

"Some companies are still leery of the legislation, which requires the governor's signature, and prefer the CPUC's market-based approach…"