Arizona Solar Markets Potentially Losing Focus on Residential and Commercial Solar Projects

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Arizona solar advocates are becoming increasingly concerned that commercial solar funding in Arizona will be cut or severely reduced. Specifically, Tucson Electric Power (TEP) is focused on bringing in large utility scale projects while ignoring smaller commercial projects in the local area.

The Arizona Corporation Commission has set an aggressive goal of generating 15% of the state’s electricity from renewable sources, including solar power, by 2025. While on the surface TEP appears to be meeting its goals under the mandate, the fear is that this is being achieved at the cost of commercial solar. Recently, government-affairs representative for the Tucson Green Chamber of Commerce and the Tucson-based solar installation firm Technicians for Sustainability Lon Huber said TEP’s plan would provide only “anemic” support for the future development of commercial solar power. In addition, Abco/Westcap Solar President Charlie O’Dowd said, “When they’re trying to fulfill their mandate, it doesn’t seem to me it’s in the interest of the whole spirit of it to put the kibosh on commercial (development).”

TEP retorts that it is simply matching market forces based on the ebb and flow of the residential and commercial markets. However a focus on utility-scale projects, particularly where there is pressure on developers in acquiring enough land to make such a project feasible, could be problematic for solar in Arizona in general. Specifically, Arizona’s regulated utility companies have been mandated by the Arizona Corporation Commission to spend more than $185 million to subsidize energy efficiency projects and renewable energy (solar power) programs in 2009, and more than $1.2 billion through 2025. By focusing too heavily on utility scale you reduce the need and pool of money required to invest in residential and commercial solar.

Arizona could quickly become like New Mexico and Nevada which, on the surface, have solid solar markets but, in reality, it is simply due to investments in large utility solar projects. Opportunities for residential and commercial solar development simply do not exist in these states that are focused on investments in utility-scale solar projects. That is the potential danger that Arizona is facing now.

Image via Grand Canyon NPS

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