President & CEO of the Solar Energy Industry Association, Rhone Resch, spit on the feed in tariff program planned for Gainesville, Flordia.
His beef: “It was poorly designed,” and “the rigour in reviewing applications isn’t there,” so it will be a long time before solar plants are actually built. Resch was speaking at the PV Industry forum in Munich Germany last week.
Gainesville will pay $0.32 per kilowatt-hour for electricity produced by solar panels for the next 20 years. That’s a more than double current price of electricity. According to this September 2008 article, “In 2009, 1,000 kilowatt-hours (kWh) of electricity will likely cost customers of Gainesville Regional Utilities (GRU) $135.” Divide $135 by 1,000 and you get $.135 per kWh.
The utility will raise everyone’s electric bill to offset the costs that come with running this program. There is a 4 MW annual cap for the amount of solar panels allowed to be installed. Gainesville says installing panels will provide a 5% return for investors, as well as jolting the area with some green collar jobs.
Here’s Resch’s objection to the Gainesville operation:
Gunther Portfolio: Mr. Resch said:
You are now seeing Gainesville Florida had the first Feed-in Tariff in the country. It was poorly designed; it will probably give Feed-in Tariffs a bit of a black eye in the US. But at least it was the first.
And so the same way in Germany where you saw a city develop a Feed-in Tariff. We are now having that occur in the United States. Very important policy development, although it is capped at only 4 MW (MegaWatts).
Session Chair Paula Mints said:
Rhone, would you care to expand on your statement about Gainesville? That it is poorly designed?
Mr. Resch said:
Sure, the structure is fine. I think the rigour in reviewing applications was not there. And so many applications were put in place and then accepted by project developers who have never developed projects in the past. Who may have some land, who might be a farmer, but at this point in time there is no infrastructure and no ability to get those project financed.
So until the bigger companies really start to take a role in this particular program and they are in the queue, but what you are going to find is the first tier of projects that have received acceptance probably won’t ever get constructed. So Gainesville after six months is going to have to say “alright fine you guys aren’t going to be able to get it done, let’s go to the second tier” and that’s where you start seeing the SunEdisons and the Conergys and those kinds of companies who will be able to actually build some of these projects.
So I think In the long run it will straighten itself out, but certainly there was minimal rigour in the beginning in evaluating those applications.
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