The debate between massive solar thermal plants and distributed roof top solar projects continues to get more interesting every day. Duke Energy’s CEO Jim Rogers says the utility will build and operate solar power, and plans to invest $100 million in solar rooftops, both commercial and residential, according to the Charlotte Business Journal reports. Duke still needs to get permission from the North Carolina Utilities Commission.
This is part of an emerging trend of utilities throwing their considerable assets behind solar installations as a way to own solar power generation. Utilities are feeling pressure from their home states’ renewable portfolio standards to incorporate more renewable energy sources. (North Carolina has a renewable portfolio standard that goes into effect in 2012 and will require utilities to generate 12.5 percent of their energy from renewable sources by 2021.) Utilities are able to leverage their balance sheets to get capital at far better rates than small startups, allowing them to invest hundreds of millions of dollars in solar development.
Southern California Edison announced plans in March to invest $875 million in 250 megawatts of solar covering some 2 square miles of rooftops. PG&E’s CEO Peter Darbee recently told us that the company is in discussions to build and own its own solar power plants, but that there are some barriers for regulated utilities to cash in on the investment tax credits for solar. (Also check out our video interview with Darbee.)
Duke’s plan to spend $100 million on its own solar generation, is good news for an energy company that generates 70 percent of its power from coal, making it the third-largest consumer of coal in the United States. To his credit Rogers has been an advocate of backing renewable energy, and just last week called for “a small fee on every kilowatt-hour of electricity sold in the U.S.,” which he says would raise $11 billion annually for renewable energy research and development.
PG&E’s Darbee is calling for a change in policy whereby utilities could benefit from the investment tax credit (ITC) to build solar plants. Letting utilities tap into the ITC could be one of the best ways to connect considerable capital with solar power construction.