Rising Sun: The Slow Transition to Solar Power

SOURCE: Penn State University

Moving toward a solar energy world is the goal for many environmentalists. But the road to a golden radiation energy scenario is fraught with economic issues.

With all the excitement in the industry, the big question remains: Can the long-term promise of renewable energy shift down to common, everyday use by homeowners and businesses? For the most part it can, say industry supporters, though Motley Fool points to some instances of industry squabbling over net metering and what it means for the long-term growth of the industry.

U.S. Renewable Energy

Renewable energy is comprised of energy processes like hydropower, wood biomass, biomass fuels, geothermal, wind, solar and waste. These sources still lag as a whole behind other energy sources today, according to the Energy Information Administration.

Here are the usage percentages, per the EIA:

Hydropower 30%
Biomass Wood 22%
Biomass Waste 5%
Biomass Biofuels 22%
Wind 15%
Geothermal 3%
Solar 2%

Overall, renewable sources (listed above) made up 9 percent of the U.S. energy consumption in 2012. And renewable resources add up to about 12 percent total for the United States’ total production of electricity. Additionally, the learning curve on implementing solar energy is still quite high for most average American homeowners and businesses. Energy deregulation in some states has enabled consumers flexibility and the power to choose certain services from electric companies and cut down on their consumption or completely switch to renewable energy. The more information on the importance of energy conservation, the more difference consumers can choose to make.

Environmental Impact

Solar and wind power are both abundant resources for sustainable and renewable energy. They drastically cut down on the use of fossil fuels and produce zero to minimal greenhouse emissions. However, with any kind of large-scale development, there will be an environmental impact. A widespread use of solar panels and wind turbines can result in land and water loss, and sometimes the manufacturing of these power sources can produce large amounts of waste, according to the Union of Concerned Scientists. Solar power is undoubtedly a sustainable way to produce energy, but power structures must remain clean and impact minimal environmental damage.

Figure out the Economics

The Institute of Energy Research notes that some of solar’s bumpy path toward a bright future is due to faulty economics. A recent article notes that sun-kissed states like Arizona and California are trying to make solar become practical for homeowners and businesses, but there are tricky economics to consider. For instance, the article notes that solar payments in California are connected closely to what regular energy customers pay for daytime rates. To make up this difference between solar and non-solar customers, the three major California utilities would be faced with trying to make up about $1.4 billion in lost annual revenues. Spread among its customers, utilities would have another $185 added to its customers’ bills.

In Arizona, there are similar issues facing the solar industry. Some call it a tax on solar, others are objecting to the payment plans being proposed, according to Green Tech Media. The upshot is that without a change in Arizona’s net metering system, the growth of solar would be impacted in onerous ways.

Make Solar a Utility Choice

One of the topics to be discussed at the upcoming SPI show revolves around the idea of making solar a utility choice. How can solar project developers consider industry issues from another perspective? By doing so, solar project management might find better opportunities for businesses and homeowners to look to solar for its renewable energy needs.

Clearly, as an industry that’s fast-growing, solar and renewable energy needs to find a firm footing to convince more homeowners and business to invest large sums upfront for savings down the road. In the right context, this could work. But this is an issue that will likely be argued at the upcoming SPI trade show.

 

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