By Maura Forrest
June 26, 2014
In a small town in sunny North Carolina, neighbours are banding together to bring down the cost of solar panels.
Residents of Carrboro, N.C., have spearheaded an initiative called Solarize Carrboro that could slash the cost of setting up solar panels on neighbourhood roofs from $19,000 to less than $7,000 per home.
The program relies on the power of numbers to make solar installations affordable for the average homeowner. By approaching solar companies together, the 316 participants were able to get a group discount on installation costs. Solarize has also helped residents access state and federal tax credits that cut costs even further.
Carrboro isn’t the birthplace of the neighbourhood solar movement. Solarize programs have cropped up across the U.S., including in California, Colorado, Utah, and Texas. The success of these initiatives is the latest indication that solar power is within the reach of a growing portion of North Americans.
Even without creative programs like Solarize, the cost of solar panels has dropped radically in recent years. In the U.S., solar panel installation was 60 per cent cheaper in 2013 than in 2011. This is largely due to declining costs of rooftop solar components, including solar cells and batteries. By some estimates, solar power could soon be cheaper than energy from fossil fuels.
But the growth of solar power owes a lot to net metering policies—legislation that requires utility companies to buy back electricity generated by residences and private enterprises, often at retail prices. Forty-three states and seven Canadian provinces currently have some form of net metering legislation in place. And these days, those policies are increasingly precarious.
Utility companies are waking up to the growing popularity of residential solar power. They are worried about threats to their bottom line, and are starting to resist providing net metering credits to more and more customers.
In 2013, Arizona’s largest public utility proposed a new plan that would have scrapped the net metering system and replaced it with a much lower compensation rate for residential solar panel owners. Officials with the utility claimed that the growing cost of net metering credits was being unfairly passed on to non-solar customers. The plan was ultimately rejected in favour of charging solar panel owners an extra fee for continuing to use the power grid.
In Canada, Ontario’s feed-in tariff program guarantees a constant price over 20 years for the electricity generated by eligible renewable power installations. But in 2013, the government put a cap on the program and excluded large-scale renewable projects from applying.
A flood of new solar projects could put a strain on grid operators that have to buy back all that renewable energy. But if the residents of towns like Carrboro are not assured of a good return on their investment, it could slow the growth of the rooftop solar industry.
Somehow, governments, utilities, and solar companies will need to find a middle ground.
Photo Credit: Pujanak