Published on July 6th, 2010 | by Susan Kraemer4
Italy Beats USA With 3 Times as Much Solar Installed Using Feed-in Tariffs
July 6th, 2010 by Susan Kraemer
Thanks to a Feed-in Tariff program it began in 2007 that resulted in a fivefold jump in installs, individual Italians are now installing solar on buildings at the astounding rate of 250 MW, or the size of a typical power station, every two months, in a seeming vindication of a policy that Al Gore recommended to congress in 2007, an “electranet” which would pay individuals for power supplied to the grid from their roofs.
Italy is now building more solar power every month than California is in a year, Paul Gipe is reporting at Renewable Energy World. Since beginning the Feed-in Tariff, each year Italy has installed twice as much solar power as the entire USA has, and for 2010, with 1,500 MW – will have installed three times as much as the entire US with our 480 MW.
A typical home only has enough roof space for between 2 KW and (in Italy: a mansion) 10 KW, but over a third – 36% of these new installs in Italy are over 200 KW but smaller than a megawatt – or about the space of a city block or two, about the size of a very large factory.
This large size suggests that this incentive is driving people to seek out relatively large areas such as on commercial rooftops on which to place solar plants as investments. Another 23% are between 20 KW and 200 KW, about the size that a fairly large commercial building could hold, and 21% are between 3 KW and 20 KW, which could be a smaller commercial building or a home. Only 6% are only small Italian-home-sized at under 3 KW.
The return on an investment for a small solar farm with a contract for power with a utility is set for 25 years, so it is a relatively safe investment that generates a passive stream of income. Spain’s government is now having difficulty buying all of the hours per day of solar electricity it contracted for under their far too generous Feed-in Tariff (FIT), but that is the exception.
Italy, like the rest of the world, has learned from the experience of Spain, which so dramatically lurched into – first over-incentivizing – and then cutting – its FIT, that it literally caused a worldwide tsunami of Chinese overproduction; which dramatically slashed panel prices in half last year and continues to supply far cheaper solar on rooftops from Beijing to Berkeley.
By contrast, Italy has clearly laid out what its future rates will step down by over time. There will be no sharp sudden and unexpected drops, but the rates will be tiered to go down over time by amounts known in advance, (to provide the familiar incentive to “act now while stocks last!”). The proposal cuts the tariffs 18% in three equal steps of 6% during each of the first three quarters in 2011.
Italy is a member of the EU which collectively promised at Copenhagen to reduce carbon emissions 20% by 2020, from their current emissions. These are already lower than US carbon emissions, thanks to the successful EU cap and trade system, which is essentially the same climate policy that the Senate Republicans will filibuster again (in 108 degrees in Washington) this month.
This FIT policy will help Italy meet the new EU clean energy requirements. Here, Feed-in Tariffs have had varied success entirely based on the rates offered. An extremely anemic FIT in California, that has been available in PG&E territory for several years has few takers. By contrast, an EU-style generous FIT in Oregon sold out within minutes over the weekend.
In California, the Democratic legislature has taken a first step towards a de facto FIT for solar owners. Under AB 920, you can elect to get cash back at the end of the year “for excess production” that you didn’t use at home that year (previously you could not “roll-over your extra kilowatt-hours but had to “true-up” at the end of each year), but only if you arrange to get the cash, with the rate to be determined in 2011.
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