Take a look at this story on The Daily Beast blog at Newsweek’s Web site.
In 2008, 33,500 rooftop solar systemswere installed in the United States, a 63 percent increase over the amount of capacity installed in 2007. In California, the solar capital of country, the increase was 95 percent.
Meanwhile, the outlook for the other side of the solar industry—the large, centralized power plants—isn’t so sunny. These megaprojects—think acres of desert landscape covered in thousands of solar panels sending electricity through transmission lines—controlled mostly by utility companies that have had a monopoly over the country’s electricity grid since the turn of the last century, were supposed to be the key to the future of the solar industry. So far, they’re getting vastly outpaced by the decentralized rooftop approach. According to the Interstate Renewable Energy Council’s 2006-08 count, consumers added 522 megawatts to the grid; whereas utility generated sites added just 96 megawatts.
Are power companies making an extra effort to increase investment in solar to catch up with homeowners and distributed generation? No.
The disparity has utilities worried about losing their grip on the country’s energy industry, and the $130 billion residential electricity market. In some cases, utilities are actually taking direct steps to thwart rooftop solar. Two weeks ago in Colorado, the state’s biggest utility, Xcel, tried passing a surcharge on homes and businesses using rooftop solar power. The public went ballistic, and with pressure from Democratic Gov. Bill Ritter, the proposal was eventually shelved. In early July, New Mexico’s biggest utility, PNM, filed an official request to dramatically reduce incentives for businesses and homeowners to install solar panels, and is now fighting with state lawmakers over whether it has the right to exclusively own solar panels systems hooked up to its grid.
So far, all of the innovation in solar power in the US has come from homeowners, small businesses that install solar generating equipment, and local innovators. The media lead us to believe that business innovation involves some whizbang technology. It doesn’t. Business innovation is almost always figuring out how to get the best products into the hands of the most people.
Right now, some of the most advanced business innovation in solar power is coming out of the People’s Chapel in Philippi, WV. Here’s the story from the Pittsburgh Post-Gazette. Ruston Seaman and John Prusa have created a charitable business called New Vision that puts solar power in the hands of local people for a fraction of the cost of a manufactured, turnkey system. They use innovative labor credits and partial assembly of PV panels to make their products available to nearly everyone.
Here is real business innovation that cannot be matched by power companies operating our obsolete, centralized grid:
Families who receive solar panels pay for them with two currencies: money and time.
One home can cost between $7,000 to $10,000 to outfit, with trees to clear and supplies to buy. Families pay for the panels with some of the savings they start to see on their electric bills each month. The money goes into a general community fund that finances more solar panels on more homes.
“Once 10 families start paying back, there’s enough for Family Eleven,” said Mr. Seaman.
Ten families are already slated to receive the panels, and already nine mission trips are planned this summer for groups from Pennsylvania and West Virginia to come and help install more.
In addition to those upfront expenses, outfitting a home also takes manpower; Mr. Seaman calls it Philippi’s version of Amish barn building.
To pay back their neighbors for their time, families must volunteer by either installing solar panels somewhere else or putting in community time at the church.
Mr. Prusa printed “dollar bills” that are exchanged as currency for the volunteer hours.
Here is the closing comment from a solar installer in the Daily Beast story:
“We’re buying panels at prices I didn’t think we’d see for at least another decade,” says John Berger, founder of Standard Renewable Energy, a Texas-based company that provides homeowners and businesses ways to reduce their energy costs, including on-site solar generation. Berger expects to have revenues of $50 million in 2009, this after doing $11 million in business last year, and only $1.5 million in 2007. He gets particularly agitated when talking about the utilities. “When solar came along, they thought they could ignore it. Then they thought they could just monopolize it. But the private sector is giving them competition, and now they’re scared.”
Power companies should worry even more now that innovators like New Visions are in the solar power game.