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Clean Power Credit: SARE Outreach

Published on May 28th, 2014 | by John Farrell

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Show Me Solar: Missouri’s Opportunity for Solar Power

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May 28th, 2014 by
 
What can solar power do for a single state? How about 21% of its energy, $14 billion in economic activity, and over 150,000 jobs. At a discount to existing electricity costs. Without subsidies.

That’s what solar power can do for Missouri, but the state’s utilities may be about to pull the plug on local solar power.

It started with a renewable energy standard, passed overwhelmingly in 2008, requiring the state’s utilities to get 15% of their electricity from renewable energy resources, and primarily from local sources. But attacks on the law started three years ago, when the Republican-controlled state legislature undermined the ‘buy local’ provision.

Fortunately, this didn’t stop local solar, helped along by a generous state rebate. Starting in 2011, the falling cost of solar panels led to a surge in installations. By the end of the year, the cumulative solar capacity (estimated at 120 megawatts) will have added $415 million to the state economy and nearly 4,000 jobs.

missouri installed solar capacity and forecast

But utilities abruptly pulled the plug on solar in 2013. In the middle of the legislative session where a rebate phase-out was being carefully crafted, and despite assurances that they were nowhere near the cost cap on the solar rebate program, the state’s utilities announced the programs were allegedly running out of money. No independent analysis has verified the utilities’ claims.

Advocates reached a settlement with the utilities late in 2013 to pay out the remaining rebate funds, but efforts to re-open the compromise on a reduced solar rebate were sabotaged by the same utilities late in the 2014 legislative session. Now a lawsuit may be the only hope to avoid a big drop on the “solar coaster” when rebate payments stop.

Two years from now, this “bust” cycle may be just a bad memory, however. Electricity prices have been rising by 5% per year over the past 5 years. The maturing solar industry has been relentlessly driving costs down, and even without the rebate, by 2016 residential and commercial solar installations will able to compete with utility-provided electricity prices using just the 30% federal tax credit.

The smart policy would have been a “glide path” away from state incentives, but it may be that utilities just wanted to buy a couple years respite from competition.

missouri solar growth with rebate phase out ilsr

For more information on Missouri’s solar challenge, see this presentation (below) given by ILSR’s Director of Democratic Energy to the Missouri Solar Energy Industries Association on February 1, 2014, and this short report on the solar industry’s economic benefit to the Show Me state.

Show Me Solar: Clean, Local Power for Missouri’s Economy from John Farrell

Photo Credit: SARE Outreach

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About the Author

directs the Democratic Energy program at ILSR and he focuses on energy policy developments that best expand the benefits of local ownership and dispersed generation of renewable energy. His seminal paper, Democratizing the Electricity System, describes how to blast the roadblocks to distributed renewable energy generation, and how such small-scale renewable energy projects are the key to the biggest strides in renewable energy development.   Farrell also authored the landmark report Energy Self-Reliant States, which serves as the definitive energy atlas for the United States, detailing the state-by-state renewable electricity generation potential. Farrell regularly provides discussion and analysis of distributed renewable energy policy on his blog, Energy Self-Reliant States (energyselfreliantstates.org), and articles are regularly syndicated on Grist and Renewable Energy World.   John Farrell can also be found on Twitter @johnffarrell, or at jfarrell@ilsr.org.



  • DGW

    Rogue states won’t go away so make the Federal tax credit 40% and there will be a huge boom. And then link the percentage to the falling price of PV power.
    The Feds need to also make it very difficult for local fossil utilities to roll back energy efficiency incentives since that would go directly against the goals of the EPA and rational people.

    • Matt

      If the Fed wasn’t controlled by fossil fuel. We could be there in very short order. Stop subsidizing fossil. Carbon tax (yea I said the T word), refunded to people. Make PV credit a cash payment (you get it even if you don’t owe taxes). Assume CO tax enough to make coal electric twice HA, and each Fed dependent gets back a equal share. All at once everyone wants to install solar. Including utilities.

  • wattleberry

    Prof. Dierdrie McCloskie, in a recent BBC discussion, defended capitalism against the current accusation of inequality by the persuasive argument that, by making the cake bigger, poverty was reduced in absolute terms and to try to reduce this only made the rich poorer without a corresponding improvement for the lowest paid. However, two, in my view, critical issues were not mentioned; the corrupting effect of monopolies and the historical indifference of entrepreneurs in their economic pursuits to the environmental consequences of their activities.

    It isn’t hard to view this case as a classic example where the monopoly is the government and the utilities are exploiting this in the traditional way.
    What it illustrates is that the professor is quite right in her assertion that the preoccupation with inequalty misses the point. What most needs attention is the flawed reflection of the will of the people by the so-called ‘democracy’ no longer fit for purpose. It urgently needs to be replaced by more direct involvement of the public utilising the internet, with businesses similarly incorporating today’s knowledge in their strategies.
    Of course, because we are naturally resistant to change, the idea of plebiscite will be scorned as unworkable due to ‘apathy’ and ‘what about those not involved with computers’ but these minorities could be catered for by non-electronic means. If only some local administrations took the initiative to try a pilot scheme to assess and refine the process we might be surprised that the apathy would evaporate when decisions were really made by the residents. It seems a much less ambitious experiment than the concept of driverless cars but it looks as though we will soon be using those!

    • http://jbsnews.com/ John Brian Shannon

      Prof. Dierdrie McCloskie, or Marie Antoinette?

      Arrogant statements about ‘cake’ tend to grate on the nerves of the ‘serf class’. It sometimes doesn’t matter who is ‘right’ or ‘wrong’ in these cases.

      The Prof’s statements are completely off. We can tell this simply by looking at the facts.

      Over the past 20 years the cake has gotten bigger, but the poor in the U.S. have gotten poorer. That is historical fact.

      Occupy Wall Street didn’t happen because the serfs were getting more cake! Multi-millions of people protested because the 1% were getting more cake while the poor were getting less of it.

      The fact that the cake was getting bigger, is a side-show — as the rich were the only ones being served cake.

      http://jbsnews.com/2014/03/29/wealth-distribution-in-america-off-the-charts/

      Cheers, JBS

      • wattleberry

        Thanks for your comments which, I suppose, could be construed as describing the destructive effect of monopoly power exercised by the 1% over the rest of us. Otherwise, they simply couldn’t get away with it.
        My notion of utopia would be if governments left everything to others except preventing monopolies, because:
        a. It would take up all their time anyway, and
        b. They’re no good at anything else.

  • spec9

    Meh. At current PV prices, the 30% Federal tax-credit is enough.

    • Kyle Field

      In my experience, yes, fully agree especially at so california electric prices ($.13/kwh Tier 1 and up). The HUGE opportunity right now is for a company to streamline the installation timing (shouldnt take several months to install panels…but days, like in Germany) and the corresponding hugely inflated retail installation cost which is ~double what a comparable system can be installed for in Germany. (if I like Germany so much, why not move there, right? :D). Let’s see Elon Musk and SC do this…:D

  • RichardKLopez

    In the middle of the legislative session where a rebate phase-out was being carefully crafted, and despite assurances that they were nowhere near the cost cap on the solar rebate program, the state’s utilities announced the programs were allegedly running out of money. http://goo.gl/gpKS7D

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