Georgia Power Company (Atlanta, Georgia, U.S.) has filed with the Georgia Public Service Commission (GPSC) to create a solar program to acquire 210 MW of new solar photovoltaic (PV) generation capacity over a three-year period.
The Georgia Power Advanced Solar Initiative would include a utility-scale competitive solicitation program as well as sub-programs for small and medium scale PV. Such a move may indicate a strategy shift by Georgia Power parent company Southern Company (Atlanta, Georgia, U.S.), which has resisted adoption of solar in the service area of its subsidiaries.
"We believe the Georgia Power Advanced Solar Initiative will encourage new opportunities for solar development in our state and catapult us to the forefront of this clean, safe energy technology," said Georgia Power President and CEO Paul Bowers.
"This initiative builds upon our record of maintaining not only one of the nation's safest and most reliable electric systems at rates below the national average, but one of the most innovative as well. We will continue to build a diverse generation portfolio that utilizes the most cost effective and advanced technologies to benefit our customers."
RFPs to begin in 2013
The utility-scale portion of the program would issue requests for proposals (RFPs) for PV projects 1-20 MW in size, with sub-programs covering PV smaller than 1 MW beginning as early as 2013.
RFPs for the utility-scale program would be conducted in 2013, 2014 and 2015, with commercial operation beginning in 2015, 2016 and 2017.
Response to solar utility plan?
Georgia Power states that the program was developed in collaboration with the GPSC. The program may also be a response to pressure from Georgia solar advocates including GPSC member Lauren "Bubba" McDonald.
McDonald has backed a plan by Georgia Solar Utilities Inc. (GSU, Atlanta, Georgia, U.S.) to create a separate utility to build PV projects, targeting 2 GW for the state. On September 20th, 2012 GSU filed for this plan with the GPSC, which would require a change in regulations granting exclusive rights to Georgia Power.
Just days after an aspiring utility filed plans to develop 2 gigawatts (GW) of solar in the state, Georgia Power is proposing to triple its use of solar electricity.
The utility, which has thus far shown little if any interest in renewable energy, usually pushes for coal and nuclear. Georgia is regularly ranked among the top 10 states for solar resources (such as available sunlight).
That makes the proposal pretty impressive: it's one of the largest voluntarily-developed solar portfolios by an investor-owned utility in the U.S. Most utilities add solar because they are under mandates from a state Renewable Portfolio Standard.
Under the Georgia Power Advanced Solar Initiative, Georgia Power is targeting 210 MW of solar by 2015, enough to supply 20,000 households.
The utility doesn't want it build it's own solar plants. It plans to buy the electricity under long-term power purchase agreements with large commercial and utility-scale projects. Just 10 MW will come from smaller residential or business installations that sell power back to the grid.
It currently has 61.5 MW of solar under contract, enough for 7,600 homes.
"We believe the Georgia Power Advanced Solar Initiative will encourage new opportunities for solar development in our state and catapult us to the forefront of this clean, safe energy technology," says Paul Bowers, CEO.
In commenting on the announcement, the Solar Energy Industries Association (SEIA) criticized the small role that distributed generation will play in the plan.
"We are encouraged by the news that Georgia Power has taken a first step towards realizing Georgia's vast potential for solar energy that to date has gone largely untapped," says Rhone Resch, SEIA CEO.
"However, more needs to be done for Georgia to become a true leader in solar and to build a sustainable solar market in the state. Important policy decisions lie ahead. It’s vital that the Georgia Public Service Commission allow both centralized and distributed solar generation to fulfill a larger role in the state’s energy mix. The program announced today offers a very limited program for homeowners and business owners to install solar on their own roofs. Distributed solar must be allowed to grow at a rate higher than 10MW per year in order to create a truly sustainable market and jobs across the state. In addition, the state needs competitive rules and standards for connecting to the grid as well as policies to allow for other solar providers to participate in the market."
Georgia Power is the largest of the four subsidiaries that make up the Southern Co., which last year was named by Green America as the "most irresponsible utility in the US" for its reliance on coal and nuclear power. Its new nuclear plant in the state has already racked up more than $400 million in cost overruns and deplays.
Solar-Only Utility Proposed
The timing of its announcement is especially interesting, coming just days after a startup, Georgia Solar Utilities (GaSU), petitioned the state to be registered as a regulated utility – it would compete with Georgia Power and would concentrate entirely on selling solar-generated electricity.
Its business plan calls for an impressive 2 GW of solar capacity ... by 2016. The first project would be an 80 MW solar farm that would connect to the grid and sell directly to residential and business customers.
GaSU believes it can quickly build large solar plants by taking advantage of the Federal Investment Tax Credit. It would sell electricity to Georgia Power and use some of the profits to buy access to the grid from the utility. It would apply profits directly customers by giving them rebates, lowering the cost of solar electricity for them.
It's not easy to become a utility - it requires both state and federal permission to proceed and gain transmission rights. And it would obviously face strong opposition from Georgia Power and other electricity providers.
In fact, a 1973 law effectively gives Georgia Power a monopoly on utility services.
“There are obstacles, there’s no question there are obstacles, but you have to look at the rewards,” says Georgia Solar president Robert Green. “We don’t know what it’s going to take, but we are prepared to go through legislative action if necessary.”
What about Georgia's Wind Potential?
Although Georgia is also home to significant wind resources, the state has also lagged on that. Its wind capacity exceeds six of the 13 Atlantic states, but it has yet to join the 11-state Atlantic States Offshore Wind Consortium. South Carolina and Florida are the other states holding back.
The consortium is a federal program that's coordinating and streamlining wind development off the Atlantic Coast.
Georgia has more than 60 GW of offshore wind potential, according to a recent National Wildlife Federation report. That's roughly the equivalent of 75 average power plants.
But Georgia says it will wait until the market and technologies are more mature, says Brian Robinson, a spokesman for Georgia Governor Nathan Deal.
"When the markets and the technology advance further, we believe there will be a day when wind energy is a viable option for our state," Robinson told The Savannah Morning News. "Georgia will start using wind energy when the prices are right and the technology is right for the unique nature of our wind energy off the coast.
While it's true that a recent Stanford study shows that offshore wind can power the entire East Coast, researchers favor areas with lower hurricane risk north of Virginia where the risk of hurricanes is lower.
A 2007 report by Southern Company and Georgia Tech concluded that "Coastal Georgia waters include large areas with good wind resources in shallow water that have the potential for wind farm development. Also, much of the coastline includes undeveloped areas with close proximity to potential landfall sites for transmission grid access."
"We're in a great position for offshore wind," Tybee City Council member Paul Wolff told Savannah Morning News. "We just haven't had a governor that's remotely interested. That's the problem."
The state also has 2 GW of onshore wind potential, but doesn't have a single, large wind farm.
Georgia even has a bunch of wind companies, including component manufacturers, ZF Wind Power and INTORQ US, which would be boosted and joined by others if the state exploited its wind potential.
Atlanta (Georgia), September 26, 2012.—Georgia Solar Utility, Inc. (GaSU) a Georgia company has proposed plans to deploy 2GW of clean energy within the next four years to diversify the state's energy portfolio and to let ratepayers benefit from the profits created through solar power.
The company filed a petition with the Georgia Public Service Commission (GPSC) on September 20, 2012 (Docket #36286 http://www.psc.state.ga.us/ ), asking to be authorized to undertake large scale solar development in Georgia. Initial plans include an 80MW solar PV farm as part of the first 500MW-phase. The petition asks for GaSU to create an optimized distributed generation system able to integrate and respond to the existing centralized generation system in a balanced way.
Having waited to start utility scale solar development, Georgia has no legacy issues with previous development and is now able to use an organized planning approach over larger territories. Georgia can build a smarter grid by requiring GaSU and the electric companies to work together to solve the technical issues of distributed generation while addressing the best interests of ratepayers. This will have electrical engineers, not investors, making decisions of materials and system locations.
Financial models of Feed-in-Tariffs (FiT) or Power-Purchase-Agreements (PPA) siphon the utility's revenues. GaSU will pay the profits on the utility revenues it takes while creating a freer market than currently exists. Solar profits will also create a Rate Reduction Fund (RRF). Using the RRFs to pay dividends back to the ratepayers, much like EMCs or mutual insurance companies is more in the best interest of ratepayers than any other financing model.
Indisputably, Georgia's greatest natural resource is the sun. It can be harvested just like any other agricultural product. Inclusion of utility scale solar energy would be a much needed diversification in the state's energy mix and create an entire new industry.
A recent study by the University of Arizona has in fact rated Georgia is one of the top three states in the entire U.S. that could benefit economically from solar generation and export of solar energy. The state's location, infrastructure, workforce and exceptional solar radiation were prime factors in the rating. The harvested energy could also be exported to neighboring states or help end the practice of buying very expensive power from out of state at peak times.
National Renewable Energy Lab (NREL) calculated Georgia's rural solar potential at 3,000 GW. Only 2GW of solar energy would create an unparalleled economic investment in the state, stimulate many new jobs and boost much needed state and local revenues. GaSU will distribute profits in the amount of $15+B to ratepayers over 40 years. Funded by private capital, the business model is based on a 20-25 year bond structure with no federal loans or subsidies other than the standard 30% FED ITC.
The implementation of a large-scale solar industry in Georgia will substantially enhance confidence in the private and public sector. Solar energy provides clean, safe and stably priced energy with no negative environmental impacts. Better manageable long-term energy costs and risks are a key factor in the willingness of new businesses to invest capital in Georgia.
"The conservative Public Service Commission has created an opportunity for solar in Georgia like none other in this country," says Shane Owl-Greason, a Co-Founder of GaSU. "GaSU grew out of the pursuit to maximize this rare moment in time. The result of putting ratepayers first while protecting the incumbent utilities from lost profits is at GaSU's core. GaSU is poised to tap Georgia's solar potential for future generations. There is no greater gift we can give back than to use this opportunity to create a better tomorrow by reducing the future costs of electricity."
By Ellen Reinhardt
Georgia Power has filed a proposal to more than triple the company’s solar energy production. But it’s smaller than a plan from a competitor.
Georgia Power’s proposal would increase the amount of solar power it buys from homeowners, small businesses and commercial vendors by 270 megawatts over the next three years.
Vice President Mike Hazelton says that would power 26 thousand homes.
“As we have seen in the solar industry over the last several years we’ve seen vast changes and improvements. And it’s becoming more cost effective now.” he says.
But competitor Georgia Solar Utilities says it wants to provide 2 gigawatts of solar power – 5 percent of the state’s energy needs.
Georgia Power Vice President Greg Roberts says they could work with Georgia Solar without having to compete.
He says “I don’t see any reason why the Georgia Solar folks couldn’t put in a bid on our large-scale program if you will. They’re interested in developing large-scale projects, and we have 60 mega watts of those a year so I think we could work together on that.”
Roberts says they would not have to increase rates to customers.
He says “It’s good for solar developers. It pays them a good price for their solar generation. It’s good for individual homeowners and businesses that want to put solar on their facilities. But it’s also good for all customers who don’t put solar on their facilities. So we think it’s a win for everybody.”
Neither plan would go through without approval from the Public Service Commission, which is reviewing the requests.
Jessica Moore, executive director of the Georgia Solar Energy Association says they are closely following the Public Service Commission's deliberations on this proposal.
She says "We are glad to see Georgia Power recognize solar as a viable, cost-effective method of delivering electricity to its customers. This is a good first step toward increasing Georgia's solar infrastructure."
Moore says "Solar creates jobs, keeps rising energy rates in check and makes Georgia more self-sufficient when it comes to meeting our energy needs."