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Note To PUC: Changes to Electricity Rate Design Could Dramatically Impact the Future of Solar PV

A new report from the Department of Energy’s Lawrence Berkeley National Laboratory (LBNL) finds that the future growth of distributed generation solar PV is heavily influenced by retail electricity rate design – and that proposed changes to net metering rules and retail rate structures could harm increased adoption of distributed solar.

The report, titled Net Metering and Market Feedback Loops: Exploring the Impact of Retail Rate Design on Distributed PV Deployment, is meant to inform the public and utility regulators that about the effects of changes proposed by a growing number of states to their net metering rules and retail rate structures – changes fueled by worry that increased adoption of distributed PV could result in unwelcome financial impacts on utilities and consumers.

Ryan Wiser, one of the report’s authors, said utilities are primarily concerned that solar customers don’t always pay their fair share of fixed infrastructure costs. “Utilities sometimes claim that net-metered solar customers are unfairly subsidized under existing net metering rules, with non-solar customers paying a larger share of the fixed costs of the electric grid,” Wiser said.

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German Wind and Solar Power Overwhelming Neighboring Grids

Germany’s drive to harness wind and solar power is producing so much electricity that it’s spilling over into neighbors’ grids and increasing the threat of blackouts.

Poland and the Czech Republic are spending $180 million on equipment to protect their systems from German power surges, while Austria is curbing some trading to prevent regional networks from collapsing. On a windy day, the overflow east can exceed the output from four atomic reactors.

Germany’s fivefold increase in green energy in the past decade has outpaced investment in power lines to move it across the country. Electricity is looping through Poland and the Czech Republic to reach southern Germany, where supply is constrained as Chancellor Angela Merkel ordered the closure of nuclear plants after the 2011 Fukushima disaster in Japan. The disruptions show the limits to the European Commission’s vision of a single power market.

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First Ever Utility-Scale Solar PV Project Breaks Ground in Jordan

Last month, Jordan took a major step toward achieving increased independence from imported energy. In the coastal city of Aqaba, the kingdom’s very first utility-scale PV project broke ground. The 10-megawatt (MW) Shamsuna Project is scheduled to enter into full operation when construction is completed in October of this year.

Spearheaded by a partnership between Desert Technologies and Enerray SpA, the Shamsuna Project is the first of 12 renewable energy projects under management by the Ministry of Energy and Mineral Resources (MEMR). Jordan’s National Electrical Power Company (NEPCO) is backing the project with a 20-year power purchase agreement.

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Three Island Nations Are Ready for Renewable Energy

Powering and fueling societies by harvesting solar, wind and other clean, renewable energy resources makes good sense anywhere, anytime – especially now that technical performance has improved and costs have dropped so dramatically. Nowhere is this more true than it is for small island nations where energy costs are high and human populations, not to mention ecosystems and natural resources, fragile and threatened.

Releasing its Renewables Readiness Assessment (RRA) reports for three South Pacific island nations – Fiji, the Marshall Islands and Vanuatu – IRENA (International Renewable Energy Agency), concludes that tapping into solar, wind, geothermal, marine, biomass and biofuel energy would not only meet electricity needs, it would reduce energy costs, create gainful employment, broaden energy access, and set these and other island nations firmly on the path towards sustainable energy self-sufficiency.

Though very different in terms of geography and geology, the three small island nations are blessed with an abundance of renewable energy resources but have only recently launched efforts to harness them for power. 

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The Lessons Coal and Electricity Markets of the Past Can Offer Solar+Storage Markets Today

The path to scaling up clean energy technologies like solar+storage sometimes can seem like unchartered territory. It can be challenging to figure out the best strategies to develop large, mainstream markets for clean energy technologies. So, it’s good to know that we’ve been on this path before, and that energy transitions of the past can provide some lessons for the future.

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Competition in Booming Energy Storage Market Continues To Heat Up

Australia, the sunniest continent, is luring solar battery suppliers from Tesla Motors Inc. to LG Corp. as the global roll out of the technology for home and business power storage gathers pace.

At stake is a domestic market that could be worth A$24 billion ($18 billion), according to Morgan Stanley. Australia leads the world in putting solar panels on roofs, and by 2040, about one in two homes are forecast to rely on sun power.

Elon Musk’s Tesla plans early next year to bring its new batteries to Australia, which will join Germany as its first two markets outside the U.S. LG Chem will offer new technology to Australian homes in August, while Panasonic Corp. plans to begin selling its batteries in the country in October.

“Australia has all the criteria that you would look for — high sunshine, high energy prices and low financing costs,” Michael Parker, an analyst at Sanford C. Bernstein & Co. in Hong Kong, said by phone. “It’s a good test market.”

With solar power set to draw $3.7 trillion in investment through 2040, according to Bloomberg New Energy Finance, interest in power storage is surging.

LG Chem wants to capture 30 percent of the Australian market, the South Korean company said in an e-mail response to questions. The industry could could grow 15-fold in the next two years to more than 30,000 storage systems, it said.

Storage Units

Samsung SDI Co., meanwhile, is testing its storage units with Australian retailer Origin Energy Ltd., which expects to offer the products to customers later this year, and AU Optronics Corp. of Taiwan is working with AGL Energy Ltd.

Government subsidies and falling prices fueled a wave of growth in solar panel installations in Australia, and the country is set to see further expansion. About 6 million, or half of Australian homes, are forecast to have solar systems by 2040, according to Bloomberg New Energy Finance.

“The ability to store the energy that’s generated by solar is a huge opportunity within this market,” Heath Walker, Tesla’s marketing manager in Melbourne, said by phone. In coming months, the company plans to unveil battery partnerships with utilities or solar developers in Australia, he said.

Battery storage does face obstacles, though, with the cost and the size of the systems needed to maintain a reliable power source deterring some consumers, the Grattan Institute found.

Falling Tariffs

“Everybody says it’s an emerging market, but I’m not sure many people have bought batteries yet,” Origin’s Managing Director Grant King said in an interview. “Will we see a wholesale migration of customers off the grid because of batteries? My answer is no.”

Declining battery costs, surging electricity prices and falling tariffs for feeding excess power to the grid could drive storage, the Australian Energy Market Operator found.

Battery storage will allow homes with solar panels to store excess electricity for later use, reducing peak power consumption and potentially energy costs, Panasonic said.

“Storage is coming,” Panasonic’s local Managing Director Paul Reid said in a June 2 interview. “There may be things that impact the speed of the roll out, but it will dramatically change the landscape of the energy sector in Australia.”

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Listen Up: Pope Calls for the Replacement of Fossil Fuels, Renewable Energy and Solar Subsidies

We’re talking about religion this week. Did I get your attention? How about if we talk about climate change, more renewable energy, dirty fossil fuels and solar subsidies? Okay, we’ve already covered these topics. But now the Pope has chimed in with his “On Care For Our Common Home” Encyclical. I’m probably the worst person to comment on this 180 page Encyclical (I got kicked out of Hebrew School). There is no doubt in my mind that the Pope’s analysis and commentary will definitely affect U.S. politics related to clean energy.

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