Opinion: Solar Critics Should Get Their Facts Straight

R. William Potter | January 18, 2011 | Opinion
Instead of criticizing incentives and subsidies, solar naysayers need to get a little closer to the numbers

At a time when New Jersey is crying out for more jobs and sorely in need of economic stimulus, solar energy — the one bright spot in the picture — is under increasing attack. Critics charge that the state’s system for “incenting” solar projects is too expensive, arguing that it’s time to end the “subsidies.”

The critics don’t know what they’re talking about. Solar is a boon for jobs, a blessing for the environment, and a bargain for the economy — and it’s getting cheaper all the time.

So why does a virtually unanimous state legislature — urged on by some of the same shortsighted business interests who attack solar as too costly — rush through a bill (A-3442) to compel ratepayers to subsidize construction of some 2,000 megawatts (equal to two large nuclear facilities) of fossil-fueled power?

Meanwhile, Gov. Christ Christie’s administration is putting out troubling mixed signals about the future of solar. (Full disclosure: My law firm, Potter & Dickson, is representing Mid-Atlantic Solar Group in challenging Christie’s diversion of societal benefit charge funds.)

Board of Public Utilities (BPU) President Lee Solomon recently told a gathering of business leaders that he plans to revisit the state’s Energy Master Plan. Everything is on the table, including future BPU support for solar. Given the low cost and unmatched benefits of solar, the answer may have more to do with “small government” ideology than with economic facts or environmental goals.

How costly are these solar subsidies for the average ratepayer? Hold on to your wallet. It comes to about two-tenths of a penny per kilowatt hour per month for a residential ratepayer to help promote solar development.

The retail rates for electricity come to about 15 cents per kilowatt hour. In other words, solar costs less than 1 percent of a ratepayer’s utility bill. (This data is from a recent study by the Rutgers Center for Energy, Economic & Environmental Policy commissioned by the BPU.)

And what is being done with that princely, which — though nearly invisible to the naked eye — nets tens of millions a year? Plenty. Since the BPU began underwriting solar projects with cash rebates and other incentives, more than 6,900 solar systems have been installed around the state.

As a result of a decade of generally favorable — if frequently confusing — BPU solar policies, hundreds of houses, schools, office complexes, parking garages, municipal buildings, barns and even farm fields have been covered with solar arrays that soak up free sunlight and pump out clean, infinitely renewable energy.

Little New Jersey is now second only to mighty California in the use of solar power, generating more than 250 megawatts of electric capacity (equal to one midsized coal or natural gas plant). On a per square mile basis, the Garden State is easily No. 1 when it comes to going green with solar power.

Solar is a green-jobs machine and a green-business incubator. Some 200-300 companies are active in New Jersey installing solar collectors. They employ more than 3,500 people and, according to a BPU report from last September, the trend line is going up. Solar entrepreneurs added some 10 megawatts a month of solar power, “a run rate that doubled from 2008 to 2009 and doubled again from 2009 to 2010.”

Helping speed the solar plow is PSE&G, arguably the nation’s leading solar utility. Under the guidance of Ralph Izzo, a former aide to Gov. Tom Kean and Sen. Bill Bradley, PSE&G has embraced green energy. By the end of next year PSE&G’s aptly named “Solar 4 All” program will add 80 megawatts, much of it generated by the ubiquitous solar panels topping some 200,000 utility poles around the state.

If current trends continue, a decade from now solar will have created 80,000 new jobs and saved ratepayers $400 million a year in lower wholesale electricity prices (solar reduces the peak-period costs of buying power on the grid at the most expensive times of day and year). This “solarization” will leverage some $15 billion of in-state capital investments, according to a Navigant Consulting report for the BPU. Not bad for an industry that barely existed a few years ago.
As New Jersey and the nation retool for a sustainable future, the last thing the state needs to do is cut back support for solar development. Solar rids the atmosphere of pollutants, slows the march of potentially catastrophic global climate change, creates jobs and stimulates new business opportunities in a state that sorely needs all the help it can get.

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