DEEP DIVE
Two roads diverging: Pennsylvania lawmakers rethink their renewables mandate
Policymakers are making decisions on how to change the state’s alternative energy portfolio standards by 2021, causing a tension between utilities and distributed solar activists.
Herman K. Trabish reports for Utility Dive
Pennsylvania leaders have big choices to make about the state’s energy and solar future that will impact its power sector for the next decade.
Policymakers must choose how to change the state’s Alternative Energy Portfolio Standard (AEPS), which now requires 18% alternative energy by 2021. And, if they replace the AEPS’ 0.5% carve-out, they must choose whether to include 90% utility-scale solar or 35% distributed solar.
At the end of 2017, Pennsylvania was at 0.2% solar. A draft plan for 10% solar by 2030 was released in July. Its choice of a largely utility-scale solar carve out, or one that includes over one-third distributed solar, has already started a classic solar debate between utilities and distributed solar advocates.
“Pennsylvania is working on the energy sector’s next generation and solar should be key,” said Patrick McDonnell, secretary of the Pennsylvania Department of Environmental Protection (DEP), which hosted the stakeholder-led process that produced the plan. “With its low installed price continuing to drop, solar must be a bigger part of our energy mix to keep us competitive with surrounding states.”
The new solar plan shows Pennsylvania “wants the jobs and environmental and energy benefits that come with solar,” he added. “The state’s utilities need to understand we are moving from large centralized plants to a more distributed energy grid and that means changes, but those changes can help utilities deliver better power quality and resilience for their customers.”
A state ready for change
“Pennsylvania is lagging behind its neighboring states,” Vote Solar Mid-Atlantic Director Pari Kasotia told Utility Dive. “This plan may push the legislature into action on an increased renewables mandate that includes a solar future.” The numbers support her point.
Pennsylvania installed 372.63 MW of solar at the end of 2017, to meet 0.2% of its electricity needs, according to the Solar Energy Industries Association (SEIA). That ranked it 22nd in the U.S., created 3,848 solar businesses and produced a total $1.5 billion investment in solar.
This puts it well behind its border-states, Maryland and New Jersey. Maryland, Pennsylvania’s Mid-Atlantic neighbor to the south, has half the population, but an installed solar capacity of 932.7 MW which meets 2.92% of its electricity need, according to SEIA. It ranks 13th nationally, has 5,324 solar businesses, and a $2.6 billion total in-state solar investment.
Across the Delaware River, New Jersey has three-fourths the population, but ranks 5th nationally with an installed solar capacity of 2,446.79 MW, SEIA reported. It met 3.87% of its electricity need with solar in 2017, had 7,106 solar businesses and $7.8 billion in total solar investment.
A comparison of solar’s job creation as well as RPS goals in neighboring states.
Credit: From the DEP’s draft solar plan
“Nearby states have embraced solar development to a greater degree,” the first paragraph of Pennsylvania’s Solar Future Plan acknowledges. But the experience gained by policymakers, utilities, and solar developers in those states “can now be used [in Pennsylvania].”
Despite the state’s apparent lack of progress compared to its neighbors, the state moved from 26th to 22nd in SEIA’s 2017 national rankings, evidence that the state “is moving forward,” the plan reports. “There is significant potential for solar to continue this growth and transform the electricity generation sector.”
Pennsylvania Governor Tom Wolf’s administration took a significant step forward with October 2017’s Act 40, McDonnell said. The Act will help boost solar growth by protecting Pennsylvania’s solar renewable energy credits (SRECs) price.
Several factors, including other states selling their SRECs to Pennsylvania utilities, caused an oversupply and drove REC solar prices sharply down, RER Energy Group VP for Strategy Chris Flynn told Utility Dive.
The plan describes a set of “Cross-Cutting Strategies” that go beyond the Act. They include a more demanding AEPS, carbon pricing, innovative rates and financing programs. Widely endorsed by distributed solar advocates and rejected by utilities, these strategies could bring down solar costs and drive Pennsylvania’s solar market.
“The next step is to engage with the legislature and others,” McDonnell said. “Reconsidering and expanding solar is the starting point because the AEPS’s 18% mandate will be met by 2021. This plan asks ‘what comes next?'” Read the full story
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Despite the state’s apparent lack of progress compared to its neighbors, the state moved from 26th to 22nd in SEIA’s 2017 national rankings, evidence that the state “is moving forward,” the plan reports. “There is significant potential for solar to continue this growth and transform the electricity generation sector.”
Pennsylvania Governor Tom Wolf’s administration took a significant step forward with October 2017’s Act 40, McDonnell said. The Act will help boost solar growth by protecting Pennsylvania’s solar renewable energy credits (SRECs) price.
Several factors, including other states selling their SRECs to Pennsylvania utilities, caused an oversupply and drove REC solar prices sharply down, RER Energy Group VP for Strategy Chris Flynn told Utility Dive.
The plan describes a set of “Cross-Cutting Strategies” that go beyond the Act. They include a more demanding AEPS, carbon pricing, innovative rates and financing programs. Widely endorsed by distributed solar advocates and rejected by utilities, these strategies could bring down solar costs and drive Pennsylvania’s solar market.
“The next step is to engage with the legislature and others,” McDonnell said. “Reconsidering and expanding solar is the starting point because the AEPS’s 18% mandate will be met by 2021. This plan asks ‘what comes next?'” Read the full story
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