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Vail Valley solar: Distributed rooftop panels may have a future after all

Bill SepmeierVail, CO, Colorado

Matt Hildner of The Pueblo Chieftain recently reported that Xcel Energy will scale back on the number of solar energy plants it hopes to build in the San Luis Valley, citing uncertainty over when a proposed transmission line to export that power could be built. Xcel, which partnered with the Tri-State Generation & Transmission Association to build the proposed line from Pueblo to Walsenburg and into the Pueblo area by May 2013, has revealed its revised plans in a recent filing with the Colorado Public Utilities Commission.A year ago or more, I wrote about what might be the end of the small rooftop solar business, given that utilities like Xcel had been given the 30 percent Federal Investment Tax Credit for the first time, as part of the first Bush-Paulson bailout of the New York investment banking and unregulated casino industry. Over the past year, that prediction has proved remarkably accurate, since the vast majority of what little solar business has been done was utility-scale, utility-owned and utility-operated project deployment. After all, why pay retail from 100,000 small producers through “net-metering,” when you can put in a huge array at a subsidized 30 percent discount from wholesale, plus 50 percent depreciation year one, and sell the same 100,000 people energy that, for you, is now free to produce? Even though location-distributed solar generation is a far better way to implement the technology – since it isn’t cloudy everywhere most of the time utilities charged ahead to build gargantuan solar arrays on the cheapest, sunniest land possible. Even though the grid they operate can accept power from every location it serves and no new infrastructure is needed to support a distributed model, the utilities opted to try to build new transmission lines out into the middle of nowhere. If the energy is free, Xcel figured the costs of some new lines aren’t so high when amortized over a few years. They’d lobbied hard and long for that tax credit and the party was on.Until it wasn’t, evidently.Now Xcel’s faced with a looming ban on coal burning and a 30 percent renewable energy input mandate. Dollars to donuts says their rebates and renewable energy credits will stop falling, since they’re going to need their customers’ rooftop solar power a bit more than they’d anticipated.The tide may be turning back toward rooftop distributed power generation soon, since the cheapest land is cheap for a reason: There is no infrastructure out there.The federal tax credits have never been better for solar hot water and electric systems, nor have the costs been lower. Solar electric generation that was $8 per watt wholesale two years ago can be purchased for around $2 wholesale now. Payback times can be as low as three years in some cases. And nothing beats having the lights and heat on during those six-hour winter power failures we have up the Sweetwater Road.A year ago I quoted Earl Butz, Richard Nixon’s Secretary of Agriculture, who said of farming in the 1960’s, “Get big or get out.”Perhaps I spoke too soon.Bill Sepmeier is a local entrepreneur who has experience in the solar energy industry. This column was composed and transmitted using on-site-generated solar and hydro power.


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