Where's the Clean Energy?
It was in Germany that Ed Regan realized Gainesville, Florida, was going about things all wrong. The assistant manager at Gainesville Regional Utility (GRU) was out looking for ways to boost his city's renewable energy capacity. "Germany was a game-changer," Regan says. Wind turbines and solar panels seemed to be everywhere. He soon learned the secret.
Before Regan's June 2008 trip, the GRU was trying to promote small-scale renewable energy generation by offering hefty cash rebates to customers who installed solar photovoltaic panels. And it had a "net metering program" that allowed customers who generate their own power to run their electricity meters backward, thereby cutting their electric bills potentially to zero.
But the programs weren't attracting a great deal of interest. The utility's rebate program had yielded only 300 kilowatts of solar power capacity--roughly the amount of electricity used by 160 hair dryers--and it cost a lot of money.
The difference between Gainesville and Germany was that Germany had a national feed-in tariff. Under this system, energy consumers can become renewable energy producers by installing solar panels on their roof or a wind turbine in their backyard and selling their energy to the local utility. These customers-turned-producers receive above-market prices for their energy, often for up to twenty years. With the feed-in tariff, Germany boosted its renewable energy production from 1 percent of its total output in 1995 to 12 percent in 2005. By 2007 renewables supplied 14 percent of Germany's electricity. Denmark and Spain also have successful feed-in tariff programs.
So this past March, Gainesville rolled out its own feed-in tariff. GRU now pays twice the retail cost for every kilowatt of solar power-generated electricity. The extra cost means a small increase in electrical bills for all utility consumers, less than a dollar per month per household.
But in order to keep consumer prices down, the feed-in tariff is limited to expand by only 4 megawatts of solar photovoltaic capacity per year, for six years. And the first year's quota was snapped up in just two weeks. The program now has a waiting list through 2016. Rather than a bunch of homeowners each installing a few panels, the Gainesville quotas were mostly taken by commercial investors.
Among them is Dave Davis, a north Florida native who after sixty-five years in wholesale and retail gasoline distribution is getting into solar. "I have six acres out back where I am going to put the solar," says Davis, whose Southern drawl makes the word sound exotic, almost foreign: soh-laar. "I been on both ends of the oil companies," he says, "and I'd like to see a lot more solar here in Florida. A lot less dependency."
For Davis, the small solar farm represents income security for his heirs. But the larger wisdom of feed-in tariffs is also clear. Studies show that such laws boost green energy production. And feed-in tariffs transform the economic function of the electrical grid: no longer is it a centralized technological embodiment of corporate power and hierarchy. With feed-in tariff legislation, electricity starts running both ways along the wires. And by extension, so does money and political power.
Perhaps that's what's keeping feed-in tariff legislation from spreading in the United States: it begins ever so slightly to break the near-monopoly of the private utilities. It creates new economic constituencies (small, clean-power producers), and it is a reassertion of the state's right to control its infrastructure.
Gainesville's solar program is one of many attempts to boost green energy production across the country. From California to Vermont, an increasing number of states and municipalities are moving to adopt feed-in tariffs and other innovative strategies for boosting clean energy production and reducing energy consumption.
Unfortunately, these efforts are Lilliputian in the face of climate change. The United States and other developed countries must cut carbon emissions by 80 to 95 percent over the next few decades to avoid very serious climate change. That goal is not impossible to meet. Numerous studies indicate that the United States could dramatically improve its renewable energy capacity if it had the right policies and financing. But in conversations with public officials, utility operators, small-scale energy producers and green energy advocates, one issue emerged again and again: the United States lacks long-term national clean energy planning. Basically, the government has done little to end the monopolistic hold that private utilities and fossil fuel industries have on energy policy.
First, though, some good news: more than thirty states have implemented renewable- or alternative-energy portfolio standards. These are policies that require electricity providers to obtain a minimum percentage of their power from renewable energy resources by a certain date. California Governor Arnold Schwarzenegger recently increased his state's standard from 20 percent by 2010 to 33 percent by 2020. Several other states are shooting for 25 percent by 2025, with Hawaii aiming for 70 percent by 2030. And California, Hawaii, Wisconsin and Vermont all have feed-in tariff legislation.
"You can't really look at renewables in a vacuum, though," says Terry Tamminen, a climate change expert at the New America Foundation. "The other side of the fight to reduce carbon emissions is energy efficiency. Progress on these two fronts makes me much more optimistic about what can be accomplished in meeting greenhouse-gas reduction targets."