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7/31/18  9:59 am
Commenter: Rachel Smucker, Secure Futures

Secure Futures, LLC Comments for Virginia's Energy Plan
 

On Monday, July 23, 2018 Secure Futures CEO and President Tony Smith and Policy Analyst Rachel Smucker made the following recommendations to the Virginia Solar Energy Development Authority regarding Virginia’s Energy Plan:

 

·       In 2016, according to the National Solar Jobs Census, there were just over 260,000 solar jobs in the U.S. Three-thousand of those jobs were held by our fellow Virginians.

·       Based on NOA statistics, Richmond and other cities have experienced a 1.5% increase per year on their cooling loads due to the effects of Climate Change.

·       Now if Virginia were to commit to producing 10% of residential electricity consumption from solar, we could create over 50,000 new jobs here in the Common Wealth.

  • Achieving the 10 percent goal would require the solar industry to build 15,000 megawattsMW of solar. 

·       Going back to the National Solar Jobs Census of 2016, it shows that approx.. 69% of total solar jobs in the U.S. were in the residential and commercial market segment, while only 31% were in the utility-scale market segment.

·       There is a huge economic impact that results from distributed generation solar because those projects tap into local talent and local sourcing at a higher rate than utility-scale projects.

·       Companies like Secure Futures would support a much more balanced approach to meeting the state’s solar needs. We can’t just survive on utility-scale solar. We need residential and commercial scale solar, as well, to truly tap into our greatest job and economic potential.

·       The Virginia Energy Plan should seek to increase the state’s PPA pilot program, per the VSEDA 2017 Annual Report that states “expanding third party ownership options beyond utility pilots and allow all sectors to participate” (14) as a significant way to reduce barriers for the commercial, industrial, and residential market segment.

·       The Energy Plan should also seek to raise the NEM project cap to 2 MW, and the total cap to 10% of peak demand, and to encourage SCC staff to conduct an analysis on removing the cap altogether.

·       Lastly, as we seek to modernize our grid through the Grid Modernization Act of 2018, Virginia should also seek to modernize the utility business model to better meet the needs of our current times. We propose that the SCC and/or legislature encourage the utilities to engage with stakeholders to develop a new business model that incentivizes utilities by rewarding them for performance in helping to achieve Virginia Energy Policy goals as well as Virginia Economic Development goals.   Hawaii offers a precedent in HB 2939.

 

Secure Futures, LLC. - Comments for Virginia Energy Policy

 

Increase Dominion PPA Cap:  The Dominion PPA pilot is now capped at 1 MW per project, and 50 MW overall.  The APCO total cap is at 7 MW total.  There are no PPA’s registered yet in APCO territory.  Total Dominion territory PPAs are now at 7.3 MW, that increased by 5 MW in just the past six months.  We are seeing an accelerating trend in Dominion territory.  Based on projections from Sun Tribe and Secure Futures, and solar PPA RFP’s now in the pipeline, we anticipate we will approach the 50 MW cap by Q4 in 2019 in Dominion territory.  To avoid a start-stop in our industry next year, we need to raise the project cap to 2 MW, and the total ceiling to 200 MW for Dominion in this legislative season, to take effect July 1, 2019, and encourage the SCC staff to conduct an analysis on removing the cap altogether and to make it a permanent part of the Code.

 

Increase Net-metering Cap:  The NEM cap per project is 1 MW, and total is 1% of peak demand. Per Ken Jurman, in Dominion we are 10% of peak, and for APCO, at 25%.  We would propose raising the project cap to 2 MW, and the total cap to 10% of peak demand, and to encourage SCC staff to conduct an analysis on removing the cap altogether.

 

Explore Utility Incentives for DG:  We discussed ways to incentivize utilities to invest in third-party owned solar, be they residential customers or third party owned commercial PPAs.  Utilities can benefit from the efficiency of the private sector, earn a higher return for ratepayers than utility-owned solar, and stimulate more jobs and investment in Virginia by co-investing in DG solar.  We propose that the SCC and/or legislature encourage the utilities to engage with stakeholders to develop a new business model that incentivizes utilities by rewarding them for performance in helping to achieve Virginia Energy Policy goals as well as Virginia Economic Development goals.   Hawaii offers a precedent in HB 2939.

 

Virginia Solar Jobs Brief

Secure Futures, LLC.

Virginia’s Solar Job Potential— A Synopsis

 

  • The Commonwealth of Virginia had 3,236 solar jobs in 2016, a 65 percent increase from 2015.
  • Virginia had 241 MW of solar installed by end 2016, representing 0.1% of total electricity consumption.
  • If Virginia met 10% of residential electricity consumption with solar, Virginia could create 50,400 new jobs.
  • Achieving the 10% goal would require the solar industry to build 15,000 MW of solar. 
  • On average, residential and commercial rooftop solar create 69% of all solar jobs in the distributed generation solar market.

 

 

  I. What’s At Stake?

 

  1. Bloomberg New Energy Financeestimates that investment opportunity in the solar energy market through 2040 will be approximately $2.8 trillion.

 

     II.   Solar Creates Jobs                 

a.     According to the U.S. Department of Energy, solar power employed 43%of the Electric Power Generation sector's workforce vs. fossil fuels employed 22%(2016); and in Virginia, there are1,273 new solar jobs since 2015 and a 64.90% solar jobs growth rate in 2016.

b.     In other words… Solar makes up just under 2% of overall U.S. energy generation, yet it employs twice as many workers as the coal industry, almost five times as many as nuclear power, and nearly as many workers as the natural gas industry.

c.     The National Solar Jobs Census 2016 found of the 260,077 solar jobs in 2016, approximately 69 percentof those jobs were in the residential and commercial markets segment, while 31 percent were in the utility-scale solar market.

d.     As of 2017, there are 250,271 solar workersin the United States. – Solar Jobs Census, The Solar Foundation

  • This is a 3.8% decline, or about 9,800 fewer jobs, since 2016, marking the first time that jobs have decreased since the first Solar Jobs Census was released in 2010. At the same time, the long-term trend continues to show significant growth. 

 

   III. Virginia’s Solar Job Potential

 

  1. Last year, the Virginia Chapter of the Sierra Club released a new report from the Solar Foundation finding that Virginia could create 50,400 new jobs if it developed enough solar energy to meet 10 percent of residents’ electricity consumption over the next five years.
  2. The Solar Foundation conducts an annual census of solar jobs across the U.S. that provided much of the data used for the Virginia jobs analysis. The most recent National Solar Jobs Census found the state of Virginia had 3,236 solar jobs in 2016, representing a 65 percent growth from 2015. 
  3. Achieving the 10 percent goal would require the solar industry to build 15,000 megawatts of solar. At the end of 2016, Virginia had a total of just 241 MW of solar installed, representing one-tenth of 1 percent of total electricity consumption. 
  4. On average, residential and commercial rooftop solar create more jobs per megawatt than utility solar because they are more labor-intensive.

 

 IV. The Economic Impact: Utility-scale vs. Distributed Generation

 

  1. In a recent study by Crossborder, researchers noted that about one-quarter of residential solar project costs—for customer acquisition, installation labor, permitting and interconnection, and permit fees—are spent locally. Large commercial projects spend about 6 percent of their costs locally. The following chart illustrates the financial value of distributed solar projects to the community that hosts them:

../../../../Desktop/REW_SolarSurprise4.jpeg

  1. There’s every reason to favor distributed solar because the economic multipliers far outweigh any benefit from building solar bigger. The final chart shows the combination of purchase price less local spending value:

../../../../Desktop/REW_SolarSurprise5.jpeg

 

V. Tale of Six States: Utility Solar vs Distributed Generation Solar

Navy blue bars indicate share of solar installed by utilities. All other colors represent distributed generation solar. How could Virginia achieve a more balanced DG solar market in the future, more like Maryland, and less like North Carolina, by incentivizing utilities to support DG?

 

Rooftop Solar 

States with less than 50% utility solar

Utility Solar 

States with greater than 80% utility solar

 

Source: 2016 SEIA Data

 

 

   VI.        Testimonies

  1. “Residential and commercial rooftop solar has created most of the solar jobs in Virginia to date, and it has to be a part of the push to 10 percent,” said Sue Kanz, President of Virginia Beach-based Solar Services.
  2. “Local energy, local jobs, local investment,” Patrick Feucht, Manager of Baseline Solarin Blacksburg, Virginia, said. “Our workforce is made up of local people—three of us went to Virginia Tech, one went to New River Community College, which has an Alternative Energy Program. An increase in demand of this scale would mean we’d hire more local people.”
  3. “Nationwide, the solar market was a 23 billiondollar industry in 2016,” Karla Loeb, Vice President of Policy and Development for Charlottesville-based Sigora Solar, said. “One out of every 50 new jobs in America was created by the solar industry last year. Sigora has been part of that. We have doubled in size in the past year and now employ 80 people in the Commonwealth.”
  4. “The economics have never been better for solar in Virginia than they are right now,” Andrew Skinner, Project Manager at Sterling-based Prospect Solar,said.  “Prospect Solar has grown from two employees in 2010 to 16 full time employees today. Roles such as electricians, skilled labor, engineers, project managers, and sales people are integral to the success of each project.  We hope Virginia will commit to a rapid, sustained buildout of all sectors of the solar industry, allowing us to continue adding local jobs.”

 

 VII.        Bottom line

  1. Distributed generation scale solar delivers energy more economically than utility-scale solar.

 

“The economic arguments between big and small can’t be taken at face value, because the largest players have a vested (dare I say oversized?) interest in the outcome. Can scale economies generate cheaper electricity? Sometimes. But smaller renewable energy systems can also compete at the retail level, where their relative benefit (and the costs they offset) is also higher.

The choice between big and small is more than a spreadsheet analysis. Instead, it’s an argument about whether the economic windfall of the renewable energy transition will accrue to the incumbent players or whether tapping the wind and sun in communities across America will result in benefits everyone can share.” 

 – Report: Is Bigger Best in Renewable Energy, Institute for Local Self-Reliance, 2016

 

  1. Sources
    1. https://solarindustrymag.com/invest-in-commercial-solar-projects-earn-up-to-7-5-percent-annually/?utm_medium=email&utm_source=LNH+07-18-2018&utm_campaign=SI+Latest+News+Headlines
    2. https://about.bnef.com/blog/global-wind-solar-costs-fall-even-faster-coal-fades-even-china-india/
    3. https://www.thesolarfoundation.org/national/
    4. http://www.thesolarfoundation.org/wp-content/uploads/2017/10/TSF_VAFactSheet_FINAL4.pdf
    5. https://www.renewableenergyworld.com/ugc/articles/2018/03/19/solar-surprise-smallscale-solar-a-better-deal-than-big.html
    6. http://www.gsreia.org/site/wp-content/uploads/Crossborder-Energy-CA-Net-Metering-Cost-Benefit-Jan-2013-final.pdf
    7. https://ilsr.org/report-is-bigger-best/
CommentID: 65938