Solarize and the serendipitous solar lull
What would be the opposite of a perfect storm, a fortuitous lull? We have that right now with solar energy. Between 1998 and 2013 the price for an average residential solar photovoltaic installation plummeted from $60,000 to $20,000 (from about $12 per Watt to about $4 per watt). Unfortunately, that trend is likely to reverse for three highly foreseeable reasons.
First, there is a trade war looming between the U.S. and China, which is the world's leading producer of PV panels. China has heavily subsidized its solar industry, and the U.S. Commerce Department is about to slap them with tariffs of 10 to 20 cents per watt, or $750 to $1,500 for an average home solar PV system. There could well be retaliatory action from China, and an upward spiral of price increases. Second, Vermont has proposed ending its incentive program for residential solar at the end of 2014. Homeowners now get a Vermont rebate of as much as $2,500 for installing a system. Lastly, the Federal Reserve Bank is poised to increase lending rates. If rates go up 1 percent and a homeowner borrows $10,000 to install a solar system, the increased lifetime cost could be over $1,000.
Right now, however, we are sitting in a beautiful, lucky lull, and for those who are ready and willing to act, an investment in solar looks very good. A number of us in Windham County have been hard at work this past year to bring solar prices down even further by introducing a process called Solarize. Started in Portland, Ore., in 2009, Solarize is a form of community solar that uses a bulk-purchase type of process. A group of volunteers in a town or city make an agreement with a solar installer that solar PV will be offered to homeowners and businesses at a discounted rate through the program. The volunteer committee publicizes the program through public events, church and religious groups, business associations, neighborhood house parties, etc. The more people who sign up, the cheaper solar energy becomes for everyone. If enough people sign up in a Solarize program the savings could be as much as $3,000 for the average home PV system.
Solarize proposals in Windham County have been developed for Brattleboro, Dummerston, Windham, Newfane and Westminster and presented to either the selectboard, town energy committee, or town energy coordinator. Putney led the way and has already completed a Solarize program this year. Other towns have also expressed interest, but are looking for a critical mass of volunteers to step forward to launch the program.
One question that often arises when a town considers Solarize is this: Should we go with a local solar contractor or a large national company? There are pros and cons to each option. A local company employs local people and pays local taxes, they are a part of the fabric of the community. A large company can offer a better price and likely has more experience running Solarize campaigns. Other questions that towns should ask are: What quality is the equipment proposed? How much of it is made in America? What are the warranties? Does the company have the resources and personnel to do all of the installations in the designated program time period? Studies have shown that even if a large contractor is chosen to do a town's Solarize, all of the local solar contractors usually benefit from an increase in sales. It is truly a tide that lifts all ships.
Between the incentives that are currently available and the possibility of a Solarize campaign, the solar lull that we are in right now could result in as much as $7,000 in savings for any given household. If 200 households in Windham County participate, the savings alone would be almost $1.5 million, and the total economic benefit in jobs created and renewable energy installed would be many times that amount. All of this would be at no cost to the participating towns. The time is ripe, we should catch this tide. Call your selectboard or town energy coordinator if you are interested in helping to make this happen. Our descendants will thank us for it.
Tad Montgomery is founder of Solarize Windham and principal of Home Energy Advocates based in Brattleboro. To contact Montgomery, email him at firstname.lastname@example.org.
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