We've been actively covering the vexing issue of solar permitting and solar's "soft costs" in recent weeks. We looked at the progress Vermont is making here. We covered the issue of customer acquisition here. Solartech's efforts to lower solar installation costs was covered here, and the prospect of trimming solar bureaucracy was covered here. Plus, we've covered how all of this fits into the DOE's SunShot program of getting the cost of installed solar down to $1 per watt.
A recent report to the DOE from solar leasing firm SunRun claims that installation costs can be reduced by 50 cents per watt simply by harmonizing the solar permitting process from town to town. The report claims that inconsistencies in permitting can cost consumers up to $2,500 on a 5-kilowatt rooftop solar system. This cry for improved permitting has been put forth by Solartech, Vote Solar and other organizations and firms.
Germany has simpler processes that keep solar installation costs up to 40 percent lower than in the United States. Germany reports about one million new home solar power installations in the past two years alone, while the total number of homes ever to go solar in the United States has just broken a meager 120,000.
Now the U.S. Department of Energy is getting into the act.
As part of the Obama Administration's SunShot Initiative to make solar energy cost-competitive with fossil fuels within the decade, DOE Secretary Steven Chu just announced the availability of more than $27 million in new funding to go toward reducing the non-hardware costs of solar energy projects.
The DOE is not a legislative body -- so they can't dictate that "this is the form and process that will be used nationwide." So they have to be clever and issue a challenge.
The funding will support a $12.5 million challenge to encourage cities and counties to compete to streamline and digitize permitting processes, as well as $15 million that will be made available to advance innovations in information technology systems, local zoning and building codes and regulations.
Under the Rooftop Solar Challenge, local and regional government teams can compete for funds to help eliminate administrative barriers to residential and small commercial PV solar installations and improve the availability of financing for solar projects.
An additional $15 million in funding will create tools that local governments can use to streamline and expedite the process of installing solar energy. DOE will fund one or more recipients under each of the following topic areas:
- Codes, Standards and Processes. Projects in this topic area will work to improve existing codes, standards, and permitting processes; train code officials on new codes; and develop best practices and model codes that can be used in communities nationwide.
- Software Design Tools and Databases. Projects in this topic area will develop a range of IT systems and databases, including a utility-scale planning tool that identifies sites available for solar project development, IT tools to help installers and local governments prepare and process permit applications, and a database of local permitting processes nationwide.
Regulatory and Utility Solutions. Projects in this topic area will provide technical support for utilities to better integrate solar energy into utility operations. Projects will also provide support for states as they develop or improve the regulatory frameworks necessary to sustain a growing solar market.
Doug Payne of SolarTech had this to say: "From SolarTech's perspective, we see the DOE's $27 million investment to catalyze PV soft cost reduction as a critical step in dealing with the one of the last frontiers for accelerating solar markets across the U.S."
Payne continues, "Our industry has three main pillars: policy, products, and process. We are just now coming to grips with the importance of overall process efficiency, speed, and scale in the same vein as the semiconductor or auto industries. The challenge with the energy industry in general, and solar in particular, is the diversity of private, public, and NGO actors. This added complexity, and varying degrees of institutionalized lack of speed, scale, and process efficiency is the root of the structural problems the DOE investments are seeking to unwind. We're excited that our message, along with the message of thousands industry players the past few years, has been received."
"However, this funding translates to only $1,500 per city across the U.S. when we look long-term at the total addressable U.S. solar market across 18,000 jurisdictions. Clearly, the DOE has a catalytic role to play, but we shouldn't expect federal funding forever. So the point is, where do we go from here?"
Payne concludes, "This 'Process Signal' should show local governments, industry, and utilities the message has been delivered. It's now all about execution, leadership, and commitment to process innovation for the 21st century at local levels. The White House Office of Science and Technology Policy working with the U.S. Department of Energy have given us a signal. We now need to carry the ball, execute, and add market-based solutions to the mix to scale these efforts, building on this announcement, over the next three to five years."