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Massive US Utility Scale Solar Group Dives Into Small Scale Solar

The US solar industry group SEPA could be building the case for federal legislation leading to a new national standard for solar incentives…or not.

So, this could get interesting. The Solar Electric Power Association, a leading US solar industry trade group, is branching out to the distributed solar field after a 12-year history of advocating for utility scale solar. That could be good news for the small scale rooftop and ground-mounted solar markets given the group’s research, support services, and education activities, though it may cause some rumbles among the group’s membership, which consists of hundreds of utility-scale electricity suppliers along with solar manufacturers and other stakeholders. Or maybe not, as the case may be.

USA solar prices

SEPA Embraces Distributed Solar And Microgrids

Until now the Solar Electric Power Association (SEPA) has crossed the CleanTechnica radar mainly for its solar utility rankings. Among many other activities, the organization has also been tracking the role that utilities can play in reducing the “soft costs” of small scale solar, by helping to reduce grid connection costs.

The interplay between utility scale solar, distributed solar and small-scale solar has been growing more intense with the explosion of the residential rooftop solar market and the rise of energy storage technology, with a consequent ripple effect on the interests of SEPA’s membership. That explains this announcement by the organization back in November:

The Solar Electric Power Association (SEPA) and Association for Demand Response and Smart Grid (ADS) announced today that they are joining forces and will now move forward as one organization under the SEPA banner.

The announcement follows SEPA’s recent move to expand its mission from a focus on utility integration of only large-scale and distributed solar to a broader view including a suite of distributed energy resources, from demand response and storage to microgrids, electric vehicles and other smart-grid technologies.

Look forward to a name change in 2016 as SEPA transitions its mission and integrates its membership — and Board of Directors — with ADS. For a hint of things to come, consider that the board chair of ADS has been the Manager of Distributed Energy Resource Policy at Southern Company Services. The current chair of SEPA is the Senior VP for Regulatory Relations, Pacific Gas & Electric Company.

Also of note, SEPA’s board and executive committee includes the VP of Business & Project Development for BHE Renewables. If BHE doesn’t ring a bell, think Warren Buffett’s MidAmerican Energy, and now think Nevada and SolarCity and you’re on the right track. Didn’t we say this could get interesting?


Digging Into Solar Prices

That brings us over to the latest report from SEPA. Reflecting its stepped-up interest in the small scale solar market, SEPA has just come out with a new solar price report that attempts to pick apart state and regional pricing within the national average prices.

Using data from a select group of states and aggregated data of 11,000 prices for analysis (with research partners Mercatus of George Mason University and EnergySage), SEPA found a national average price range of $3 per watt to $4 per watt for residential solar projects, and $2 per watt to $3 per watt for non-residential and commercial.

SEPA notes that broad conclusions shouldn’t be drawn from this relatively small sample, and it unearthed no significant pattern of correlation between solar pricing and variables such as local labor costs, incentives, and other factors generally associated with soft costs.

However, according to SEPA the report does provide a useful snapshot of the state of the market, underscoring the need for more pricing transparency as well as additional research and data.

SEPA cites these two outliers to demonstrate how different factors affect solar prices in different states, with this somewhat counter-intuitive result:

For example, according to EnergySage, Florida’s inexpensive electricity and lack of solar incentives have generally kept prices quite low, with an average price of $2.51 per watt.
Washington state, on the other hand, has a solar power performance payment incentive, which is significantly higher for projects using panels manufactured in the state. The resulting average price of $4.43 per watt was the highest average price in the sample data.

And this:

According to EnergySage, New York and Massachusetts have vibrant solar markets with some limited price transparency among consumers and between vendors, factors that pushed the average price of solar to $4.03 per watt and $4.20 per watt respectively.

Maybe it’s just us, but it appears that SEPA is beginning to make the case that state based solar incentives mask the real price of solar. The organization notes that state-by-state pricing showed “comparatively more consistency” in the report, which it attributes to greater transparency in the non-residential and utility scale solar markets.

Or, perhaps SEPA is building a case to lobby Congress to enact legislation providing for a consistent national incentive for residential and small-scale solar. SEPA has issued a call for additional data leading to a followup report in 2016, so stay tuned.

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Image (screenshot): via SEPA.

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Tina specializes in military and corporate sustainability, advanced technology, emerging materials, biofuels, and water and wastewater issues. Views expressed are her own. Follow her on Twitter @TinaMCasey and Spoutible.


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