Transcript An Introduction to the Solar Electric Market Black & Decker University October 23, 2009 Presented by: Derek Coen Atlantic Electric Supply [email protected].

An Introduction to
the Solar Electric Market
Black & Decker University
October 23, 2009
Presented by: Derek Coen
Atlantic Electric Supply
[email protected]
I.E.C.- Chesapeake
Renewable Energy Committee
Foad Alvandi
Spectrum Energy
[email protected]
Don Bonnet
Ridgeway & Ernest
[email protected]
Derek Coen, Chair
Atlantic Electric Supply
[email protected]
Jim Deal
IEC – Chesapeake
[email protected]
Julie Golofski
BP Solar
[email protected]
Mike Fitzpatrick
M & S Electric
[email protected]
Jim Holt
Holt Electric
[email protected]
Tom Hummel
Aztec Electric
[email protected]
David Lucier
Crum Electric
[email protected]
Jean Maisel
JDL Electric
[email protected]
Mathew Misterka
New Age Electric
[email protected]
John Ross
Hawkins Electric
[email protected]
Eric Shatzer
Hawkins Electric
[email protected]
Grant Shmelzer
IEC – Chesapeake
[email protected]
Mike Yeakey
Anne Arundel CC
[email protected]
Despite the environment, global warming,
national security and job creation,
individuals will not make the move to renewable
energies until it makes financial sense to do so.
This Region is Being Impacted by High
Energy Costs.
The Region’s Electrical Future?
Rate Increases, Shortages and Brown Outs
Since 2001
 BGE rates have increased 74%.

PEPCO rates have increased 78%.

SMECO rates have increased 157%.

This region now pays some of the highest electrical costs in the nation.

As of June 2009, this region pays $.15/kWh (13.6% higher than the
national average.

Due to population growth and increasing production costs, electricity rate
increases are forecast to continue into the future.
Sources: Washington Post 2-3 & 7-1-08
Bureau of Labor Statistics 8-10-09
To reduce pressure on the grid, governments will increase
incentives to encourage the switch to Renewable Energy.
What is Being Done About it?
The Federal Government Has Acted
Congress Passes Investment Tax Credit (10-7-08)




The solar investment tax credit covers 30% of PV system costs.
The credit will be offered for a period of eight years (until 2017).
Over $800 million of clean energy bonds will be authorized for
renewable energy generating facilities.
This alone is projected to create tens of thousands of new jobs.
“… these tax credits have turned the solar industry from a small,
cottage industry into an economic engine for America”
Rhone Resch, President SEIA
State and Local Governments Have Acted
Maryland – Solar Related Incentives

Prohibits unreasonable restrictions of solar energy projects.
Requires 2% of state’s energy from solar by 2011 and 20% from renewable power
by 2022.
Establishes SREC program.
Establishes Clean Energy Loan Program.
Several counties now offer property tax credits.

Maryland Solar Grant: Up to $10,000 for systems under 20kWh




–
–
–
$1.25/ watt for the first 2,000 watts of capacity
$0.75/ watt for watts 2,001 - 8,000
$0.25/ watt for watts 8,001 - 20,000
“We must do all that we can to secure Maryland’s energy future.”
Gov. Martin O’Malley
What are Renewable Energy Credits?





Maryland has a program that offers Solar Renewable Energy Credits (SRECs).
One SREC equals 1000 kWh of electrical generation.
The value of an SREC is based on the Alternative Compliance Payment (ACP)
schedule (2009 = $400, 2011 = $350). This is the penalty that utilities must pay to
the Public Service Commission (PSC) for not meeting target goals.
The value of an SREC in 2009 is about 60% to 70% of the ACP ($240 to $280).
To benefit, homeowners must register their systems with the Maryland PSC and the
PJM Interconnection GATS program.
SREC Examples:
A 3kW solar system generates about 3.6 SRECs per year
A 5kW solar system generates about 6 SRECs per year.
Selling of SRECs is another way that Marylanders
can offset the costs of solar systems.
State and Local Governments Have Acted
District of Columbia Establishes New Incentives
(2-2009)




$3.00 for each of the first 3,000 installed Watts:
$2.00 for each of the next 7,000 installed Watts:
$1.00 for each of the next 10,000 installed Watts:
Maximum Rebate (20kW system):
$ 9,000
$14,000
$10,000
$33,000
Approved incentives will be paid in advance of installation.
Washington DC joins the ranks of progressive states and counties
offering incentives to purchase solar systems
State and Local Governments Have Acted
Pennsylvania opens “Sunshine Program”
(May 2009)

Residents and businesses can receive rebates for installation of PV systems.

Residential Rebate: $2.25/Watt. Capped at 10kW.

Business Rebate: Varies by size. $2.25/Watt for 3 to 10kW systems.
Capped at 200kW.

PA also participates in the AEC market (RECs).
“Today marks another exciting milestone in Pennsylvania’s
efforts to achieve energy independence…,”
Gov. Ed Rendell
The Incentives are Adding Up



Federal Tax Credit: Tax credit covers 30% of system cost.
District of Columbia: Grants based on system size. Range from $3,000 to $33,000.
Maryland: Grants based on system size range from $1,250 to $10,000.
–
–




Montgomery County – Property Tax Credit of $5,000 of system cost.
Howard County – Property Tax Credit of $5,000 of system cost.
Pennsylvania: Residential rebates based on system size range from $2,250 to $22,500.
Net-Metering: All jurisdictions offer Net-Metering.
Renewable Energy Credits (RECs): Provide additional incentives.
Sales Tax Exemption: All PV systems are sales tax exempt.
Federal and local credits, grants and rebates add up to
make the case for going solar very compelling.
Other Initiatives Exist
The Solar America Initiative
The aim of the SAI is to achieve parity with
grid electricity by 2015.
“By 2016, we expect solar energy to be the least expensive
source for consumers.”
Rhone Resch, President SEIA
How is the Solar Electric Market
Responding?
Installations are Soaring
12,000
Grid Tied
Remote habitation
10,000
Off-Grid Industrial
(MWpeak)
8,000
Global Forecast – Installed Megawatts
6,000
4,000
2,000
Source: BP Solar
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Photovoltaic (PV) Prices are Dropping
$100
$90
$80
3000
Annual MWp Production
$/W in today's $
2700
2400
$70
2100
$60
1800
$50
Global PV production & price comparison.
1500
$40
1200
$30
900
$20
600
$10
300
Source: BP Solar
0
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
$0
Production growth rates have exceeded 35% annually.
Solar Economics and Prospects
A Summary of the Market





The global PV industry has grown over 30% yearly for the past 15 years.
Prices of solar panels have continually dropped to around $4.00/W today.
Forecasts are for continued gains in PV efficiencies and cost reductions.
Government tax credits, grants and loans are playing a crucial role.
Given the high and increasing costs of electricity in the N.E., solar electric
will likely become cost-effective here before it does in many other areas.
With incentives, the solar market will continue to grow
at impressive rates -- even in the current economy!
How Does Solar Energy Work?
Solar Electric Power - The Basics
How Much Sunlight is Required?
This area is considered a
good environment for
solar energy.
DC/MD/PA
Average
sunlight
exceeds
4 hrs/day
What Direction are the Panels Pointed?
Solar will not work for every location.
Panels must be ……



Facing south
Angled to latitude
In the sun (no shade)
What are the Configuration Options?

Grid-tied
Represents 90% of solar PV market.
Takes advantage of Net-Metering option.
Simple system – modules, racks and inverter.
Does not work when grid is down.

Grid-tied with battery backup
Provides power when grid is down.
Expensive - generators are often better option.
Often used where grid interruptions can last several days and a generator
is not feasible.
Well suited for mission critical applications: medical, emergency services,
computer systems.
What are the Configuration Options?

Direct power
Ideal for remote locations that only need power during the day.
Solar module(s) powers fan or water pump.
No battery or controller needed.

Off-grid
More complex and expensive.
Often used in remote off-grid areas.
Or, where electricity is inconvenient.
Batteries require regular maintenance.
Grid-tied PV System
To AC Grid
Grid-tied With Battery Back-up
To / From AC
Power Grid
Solar System Components
Modules
 Mounting systems and hardware
 Combiner boxes and disconnect switches
 Inverter

Solar Modules
Specifications (typical):
Size: 60” x 33” x 1.8”
Weight: 25 to 40 lbs
Voltage: 17 to 36 vdc
Watts: 170 to 205
Major Manufacturers:
BP Solar
Evergreen
Kyocera
Mitsubishi
Sharp
Solar World
Mounting Systems

Roof mounts

Pole mounts

Ground mounts
Combiner Boxes, Disconnects and
Combination Boxes

Combiner Box: Enables the wiring
of multiple strings of modules into a
single inverter.

Disconnect Switch: Disconnects
power between array and inverter and
between grid and inverter. Can be
integrated into inverter.

Combination Box: Performs the
function of the combiner box and
disconnect switch.
Inverters

Converts DC power from solar
panels to AC power for home use
or Net-Metering uses.

Grid-tied inverters must match the
frequency of the power grid and
are more expensive.

Many inverters offer integrated
combiner box and disconnect.

Manufacturers: Exeltech, Fronius,
Kaco, Outback, SMA, Xantrex
What are the Costs vs. Incentives of
Solar Energy?
Typical System Installed Costs
Item
System Size < 6kW
System Size > 6kW
PV Array
$4.00
$4.00
Inverter
$1.20
$1.20
B.O.S. and
Installation Costs
$2.80
$1.80
Total Costs
$8.00 per Watt (+/-)
$7.00 per Watt (+/-)
“Rule of Thumb”Installed prices are around $8.00/Watt
Simplified System Costs with Incentives
Maryland
System Size
Approx. Costs
State Grant/Rebate
Fed Tax Credit
Total Incentive
3.0 kW
$24,000
$3,250
$6,075
$9,325 / 39%
$24,000
$9,000
$4,500
$13,500 / 57%
$24,000
$6,750
$5,175
$12,075 / 51%
District of Columbia
3.0 kW
Pennsylvania
3.0 kW
 Electrical savings/M: 3kW = $60
 Other credits could apply
 Property value increases
 Renewable Energy Credits (RECs)
 Interest on loans is deductible
 Provides Hedge against rate increases
Solar electric systems in this size would
save 75 tons of CO2 over 25 years.
What Is the IEC-Chesapeake Doing?
IEC-Chesapeake – Learning Opportunities

An Introduction to Photovoltaics:
NABCEP Certificate of Knowledge Exam offered
October 2nd, 3rd and 4th - Bristol, PA (BCCC)
Oct. 20th thru Dec. 15th - (9 wks) Odenton, MD (Tuesdays 4:00 to 6:00 p.m.)

PV Systems & The NEC (1 day course):
November 3rd, 4th and 5th - Elkridge, MD / Newtown, PA

The Business of Solar PV (1 day course):
November 17th and 18th - Elkridge, MD (U of M) / Wilmington, DE

PV Systems – Inverters & Batteries (1 day course):
February 2nd and 3rd - Odenton, MD / Bucks Co, PA
IEC-Chesapeake is proud to be recognized
as a NABCEP approved training facility.
IEC-Chesapeake - Learning Opportunities

PV Installer Certification (2 day course):
February 12th and 13th – Odenton, MD

Solar Installation Lab (4 hour lab):
By Special Arrangement – Odenton, MD

For the latest class schedule visit:
www.iec-chesapeake.com
IEC-Chesapeake is pleased to have partnered
with BP Solar for two functioning Solar Labs.
What Should Electrical Contractors
Be Doing?
Watch Developments Closely

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Solar is a natural industry for electrical contractors.
Solar systems require special skill sets and training.
The customers will be the same.
Interested contractors should be educating themselves
and watching for:
–
–
–
–
Efficiency gains in PV panels.
Price reductions in PV panels.
Increasing electricity rates.
Increased government incentives.
Things are changing in all of these areas and will
further boost opportunities in the industry.
Useful Websites
www.dsireusa.org - Database of State Incentives
www1.eere.energy.gov/solar/solar_america/about.html - Solar America Initiative
www.renewable-energy-world.com - Solar News & Industry Information
www.solarbuzz.com - Solar News & Industry Information
www.Findsolar.com - Solar Estimator
www.solarenergy.com - Education & Training
www.irecusa.org - Interstate Renewable Energy Council – Education & Training
www.nabcep.org - North American Board of Certified Energy Practitioners
www.seia.org - Solar Energy Industry Association, Lobbying & Education
www.solarelectricpower.org - Solar Electric Power Association
www.ases.org - American Solar Energy Society
www.bge.com - Baltimore Gas & Electric
www.pepco.com - PEPCO
Thomas Edison (1847 – 1931)
“I'd put my money on the sun
and solar energy.
What a source of power!
I hope we don't have to wait
'til oil and coal run out before
we tackle that.”
Thank you