Tip of the Week 43

Sunshine State?

For those who are unfamiliar with the Sunshine Energy Foundation -- it's a Florida Power and Light program which charges participating customers a voluntary $9.75 monthly fee to help the company develop Green energy.

And I'll bet that you too will find it more than a little bit curious that the very next day after the news broke that money collected by this Foundation was not used for it's intended purpose….Surprise?

It seems that nearly 39,000 Florida Power & Light customers gave the company $11.4-million of their well intended and hard earned dollars over four years to develop green energy, but a report released this week by Florida's Public Service Commission shows most of the money went toward ADMINISTRATIVE and MARKETING costs.

(Marketing money, which I presume would be spent on propaganda to convince more of we customers to voluntarily fork over our cash)

The program "does not currently serve the interest of the program's participants," the report found.

Well DAH!

So, now that the cat is out of the bag, FPL, while nursing a well deserved black eye, announced Wednesday June 25, 2008 that it plans to build three solar energy plants in Florida, including one that would be the biggest of its kind in the world.

The three plants in South and Central Florida will cost $688-million and represent the first commercial-scale renewable energy to be installed in the state. Combined they will be capable of generating enough electricity for 35,000 homes and businesses, which -- while small -- marks a big step up for solar technology.

FPL Group chairman and CEO Lewis Hay III made the announcement at a two-day state Climate Change Summit in Miami earlier in the week that was hosted by Gov. Charlie Crist. "Pending regulatory approval, FPL will build 110 megawatts of solar power right here in the Sunshine State, making Florida No. 2 in the nation for solar energy," Hay said.

The three plants in South and Central Florida will cost $688-million and represent the first commercial-scale renewable energy to be installed in the state. Combined they will be capable of generating enough electricity for 35,000 homes and businesses, which -- while small -- marks a big step up for solar technology.

The feasibility of these plants was made possible with supporting legislation - a new energy bill that put a supportive policy framework in place for solar power.

Key pro-solar provisions in the energy bill signed by Gov. Charlie Crist at Wednesday's climate change summit are:

• The value of solar equipment can't be added to the value of a home for tax assessment purposes.

• Net metering, the utility industry term for the way power companies compensate consumers for solar power they privately contribute to the grid, must be standardized statewide.

• New solar panel manufacturers that create at least 400 new jobs in the state can receive a capital investment tax credit.

What happened this week here in our "Sunshine State" is just the jump-start the Solar Industry in Florida has needed all along. When you combine skyrocketing energy costs and the decreasing price of solar technology with John Q public's growing environmental awareness IN AN ELECTION YEAR - what you end up with is a "Perfect Storm" -- a recipe for fundamental change in the way American consume their energy.

Construction of the plants should begin later this year, and the plants would become operational some time in 2009.

The news was welcomed by clean energy activists who have long argued that utilities were not doing enough to invest in solar energy, the world's cleanest renewable energy source. In the past, utilities said Florida's skies were too cloudy to make solar power cost-effective as a reliable energy source, unlike the Southwest -- where FPL Group already operates a big solar plant in the Mojave Desert.

Wednesday's news "needs to be applauded," said Stephen Smith, director of the Southern Alliance for Clean Energy. "By going to this kind of utility scale of production they are showing that solar does have potential in Florida, and that will drive cost down further."

And solar technology contractor Wayne Wallace, President of Solar Source in Largo, Fl, shares those sentiments.

For Wallace and Solar Source, the market for solar tech, such as electricity-generating photovoltaic panels and sun-powered water heaters, has been shining. The company expects sales to more than double this year from $4.5-million to $10-million, and the employee count to swell from about 40 to 80.

"It's almost unfathomable, really," Wallace said. "We're having a hard time keeping up with orders. Our phones are ringing off the hook." While the solar power industry in the state and across the country is tiny as a percentage of total electricity generation -- less than 1 percent -- its growth has skyrocketed in recent years, spurred on by high energy prices and changing attitudes toward the environment.

Nationwide, investment in the solar industry has grown more than 40 percent every year since 2000, and venture capital investment, a telltale sign of a potentially hot product, tripled to more than $1-billion between 2006 and 2007, according to a report released this month by researcher Clean-Edge.

In a sustainable world, individuals and businesses would accept at least part of the added cost as the price of finding a lasting balance between the need for energy and the benefits to the environment of renewable resources.

And in 2007, the Arizona Corporation Commission adopted one of the nation's most aggressive renewable energy standards, requiring regulated utilities to produce or buy 15 percent of their power needs from renewable sources by 2025.

The new rules also will push clean energy, mostly solar, deeper into the private sector.

Of the 15 percent renewable power mandated by the commission, 30 percent must come from distributed solar, systems installed on rooftops. The commission estimates that the requirement will lead to 5,500 new rooftop arrays in 2009 and 9,125 new systems in 2010.

"That was very deliberate," said commissioner Kris Mayes, who helped develop the standards. "We wanted people throughout the state to benefit."

The rooftop rules are likely to help small companies that can help homeowners figure out how residential systems work and could spur ground-level efforts to cut costs.

Already, several upstart companies have landed in the state with offers to lease rooftop arrays to contain costs. Furthermore, as energy costs continue to escalate, expensive solar projects will be transformed into more affordable alternatives.

But cost remains the determining factor for the majority of people considering renewable energy alternatives. Solar energy comes with a steep up-front cost, from tens of thousands of dollars for homeowners to millions of dollars for businesses that want to install systems.

With solar and with wind, as renewable energy, 90 percent of the cost or more is front-loaded. And, unfortunately, there are not a lot of people with that sort of long-term perspective. Financing is the key to unlocking these energy alternatives. Consider California, a state with some of the most expensive electricity in the nation, it's relatively easy to finance a solar project there that makes financial sense.

And if Congress fails to renew an important solar-energy tax credit this year, solar-energy conversion would slow to a crawl, at least until energy prices catch up to the cost of renewable systems.

But the most progress will come to the Solar Industry when homebuilders start offering solar panels as an option, just like granite countertops or upgraded carpet. After all, the best way to get Solar panels installed on rooftops is to be able to roll it into a mortgage.

Case study: Peoria, Arizona:

Leon and Janet Hauk decided to retrofit their existing north Peoria home with a 5.2-kilowatt system solar system, big enough to supply most of their electricity needs during cooler months and return some home-produced electricity to the grid.

"I just got tired of paying the power bill and watching the cost of electricity go up," Janet said, flipping through summertime power bills under $40. "Now, every time the rates go up, it means our system will be paid for that much sooner," Leon added.

The system cost about $14,000 after rebates and tax credits, but the Hauks have taken the advice of many solar-energy advocates who tell people to consider a solar array AN INVESTMENT and the electricity savings the RETURN ON THE INVESTMENT.

"It starts to pay for itself," said Mick Dalrymple, owner of a.k.a. Green in Scottsdale and a frequent sustainability evangelist. "How many jet skis pay for themselves? You're getting free electricity. "YOU'RE ESSENTIALLY BUYING INSURANCVE AGAINST HIGHER ENERGY PRICES." On the outside of the Hauks' home, APS installed a special electric meter with a digital arrow that points to the right when the house consumes power from the grid and to the left when it produces enough power to send it back out.

When power goes out onto the grid, the Hauks accumulate credits that they redeem during hotter months, when the air-conditioner uses more electricity than they can produce on the roof.

On a table inside, a monitor tells a more detailed story; keeping track of how much power the system has sent out and how much money the Hauks have saved in the two years since they installed the array. Those savings have topped $2,500.

"This is an asset," Janet said. "I have Formica countertops, and I don't have wood floors. And what we have, we won't have to replace in 10 years. The cosmetic things go out of style. This doesn't."

Tips:

Think of the cost of installing and alternative energy system in your home or business as a long-term investment not only for financial return, but also as a contribution in our national security and a contributing factor to renewing the health of our planet.

Things we can all do RIGHT NOW to make a difference:

· Energy: Install an Energy Star thermostat and you could save up to 500 pounds of carbon emissions per year.

· Air-conditioning: A room air conditioner too big for the room it's trying to cool will actually perform less efficiently than one designed for the space.

· Computers: You can save 40 watt-hours per day by turning your computer completely off instead of leaving it in sleep mode. That adds up to 4 cents a day.

· Cleaning: We could save as much as 1% on national carbon emissions, and $3 billion in energy, if we all simply washed our clothes in cold water.

· Cooking: Preheating your oven is usually unnecessary, except when baking bread or cookies. Just turn on the oven when you put the dish in.

Here's hoping the sun keeps shining brightly on our "Sunshine State."

See you next week.