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Posted: September 23, 2013

Mixed forecast: Clean energy braces for funding cuts

Will local sustainability programs remain sustainable once federal dollars disappear?

Jamie Siebrase

Colorado’s climate, ample sunlight and consistent investment in local think tanks haven’t hurt the state in its march toward renewable-energy leadership. Neither have federal dollars that were funneled into renewable initiatives a few years back.

When it comes to investment in renewable energy, “Colorado is absolutely at the forefront,” says Julie Herman of the Colorado Green Building Guild.

But what’s to come when the cash cow runs dry?

In the first quarter of this year, 723 megawatts of photovoltaics were installed nationally, which represents 33 percent growth for the first three months of 2012. Nationally, the non-residential market had a slow start in 2013 with just 242 megawatts of PV installed in the first quarter. Most state markets, Colorado included, shrank quarter-to-quarter. And while the Solar Energy Industries Association predicts overall commercial market growth this year, the rate could be significantly slower than in previous years. That’s because the non-residential market was hit hardest by decreases in federal- and state-level incentives, particularly Xcel Energy’s Solar Rewards program.

“We’re still seeing increases in cleantech jobs, but they aren’t as large as they were a few years ago,” says Scott Prestiege, energy industry manager at Denver Metro Economic Development Corp. “But Colorado’s cleantech industry is resilient,” he adds.

“The industry is a money-maker,” Prestiege says, citing not only installation and manufacturing opportunities, but innovation, too. Ascent Solar Technologies, for example, manufactures a thin film solar product initially built for military applications. To expand its presence, the company adapted its product, allowing customers to charge cellular devices with solar power.

Drive SunShine Institute (DSI), a Boulder-based nonprofit consulting firm, outfits local businesses with solar vehicles through outreach mechanisms like the Drive SunShine Sustainability Celebration, in which employees and suite managers can test-drive fleets of electric vehicles on site.

DSI recently assisted a large communications firm in implementing a pilot program designed to incorporate electric pick-up trucks with built-in generators into their suite. “These trucks are remarkable; they run the first 40 miles on renewable energy, then have a 300-mile gas-hybrid range,” says DSI Advisory Board Chair Ken Bietel. DSI is in the very early stages of partnering with various local municipalities as well. Companies can hope to see a return on investment in two to four years, according to Bietel.

“Demand for solar continues across the country,” says Carrie Cullen-Hitt, senior vice president of state affairs for SEIA. “The question is whether there are programs in place to support that demand.”

Thanks to local subsidies and federal grants, Colorado companies have been able to incentivize clean energy. But without continued federal support, will these operations remain sustainable?

Xcel Energy provides nearly 70 percent of Colorado’s cumulative energy needs. Its Solar Rewards program – which subsidizes residential and commercial small solar power rooftop systems thanks to a 2 percent surcharge added to monthly consumer bills – has been popular since inception in March 2006 and was named one of four notable solar PV incentive programs in SEIA’s 2012 annual report.

Entering 2013, Xcel was eight years ahead of schedule in meeting its wholesale renewable energy targets and only had 90 megawatts of distributed generation left to procure.
An impending solar cliff loomed over the market in the first quarter of 2013, leaving many uncertain about the program’s future.

“We ran out of capacity earlier this year,” says Xcel Energy spokesperson Mark Stutz. The company petitioned the Colorado Public Utilities Commission (PUC), which issued a ruling earlier this summer that approved Xcel adding another 30 megawatts and saved Solar Rewards.

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Jamie Siebrase is a freelance writer based in Colorado.

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