Consumers have been able to choose renewable energy for many years through both competitive power suppliers and regulated utilities. But solar has never been more than a bit player in these markets.
Wind power, cheap and popular, has always dominated customer choice supply. In 2012, wind made up 80 percent of supply, followed by landfill gas and biomass (12.8 percent) and hydropower (6 percent). Solar supplied only 0.6 percent of voluntary green power sales in 2012.
That may be about to change as the declining cost of solar provides new opportunities in customer-choice markets.
Green Mountain Energy Company has brought the SolarSPARC 100 electricity plan, offered in Texas since September, to New York and Pennsylvania. Customers can now power their homes with 100 percent solar power, while also contributing to the development of future solar projects.
SolarSPARC is the first and only 100 percent solar offering in these three states.
“Use of solar power is on the rise because it is a clean and increasingly affordable source of energy,” said Jason Sears, senior manager of product development and strategy for Green Mountain. “According to Hart Research, 92 percent of Americans want to see more solar installed, and we believe SolarSPARC offers consumers a way to make that happen.”
Green Mountain is offering SolarSPARC for 12.9 cents per kilowatt-hour in the Philadelphia market, compared to 10.9 cents per kilowatt-hour for wind. Prices vary by market and over time.
For now, Green Mountain is supplying customers by buying solar renewable energy certificates (SRECs) from the national market. A very small market exists for voluntary SRECs, largely managed by brokers. Since the trades are proprietary, little is known about the prices. Sears would not disclose sources or prices, but with SolarSPARC offered at a two-cent premium to wind power, the voluntary SRECs are presumably much cheaper than compliance SREC markets.
The recent announcement of merchant solar plants in Texas may imply a much larger stream of voluntary SRECs coming to market.
Green Mountain kicked off the SolarSPARC project by installing a company-funded 9.75-kilowatt PV project at the Elbow Creek wind farm near Big Spring in West Texas and will do a company-funded solar project in Pennsylvania as well. As sales increase, it plans to build a new solar project every six months, one in Texas and one in New York and Pennsylvania.
Green Mountain also offers customers rooftop solar, acting as a lead generator for local installers. “There are opportunities for both markets,” said Sears. “We have customers interested in both. We are providing as many different models as possible. None are mutually exclusive.”
“We’d all like to have solar on our roof, but sometimes that’s not possible due to the upfront cost, where we live or the orientation of our roof,” continued Sears. “With SolarSPARC, the conversation about a solar-powered home doesn’t have to end with a rooftop solar assessment.”
Green choice offers a new development driver in states where other policy supports have been hard to come by.
Pennsylvania was an early leader in solar, thanks to state incentives and a 0.5 percent solar carve-out in the renewable electricity standard. But as development surged, the price of solar RECs crashed, and PV installations dropped dramatically. Attempts to increase policy supports have failed due to opposition from Governor Corbett.
Despite the New York legislature’s failure to pass pro-solar policies, things have picked up recently due to executive actions from Governor Cuomo and the Public Service Commission. New York has committed $1 billion over the next ten years, with a goal of installing 3,000 megawatts of solar statewide. Since 2012, 300 megawatts of solar capacity has been added or is under development in New York.
According to data from the National Renewable Energy Laboratory, “green choice” sales totaled more than 48 million megawatt-hours in 2012, with about 1.9 million customers participating. The bulk of these are from unbundled renewable energy certificates (RECs), which are often bought by corporate or institutional customers to meet sustainability goals.