Solar proves old utility rhetoric wrong

As solar energy becomes more affordable, more and more people are able to access the renewable energy source, spelling good news for the future of the country's energy industry.

One of the major critiques of renewable energy, has been its cost, despite the fact that the price of a solar installation continues to fall. In fact, according to the Solar Energy Industries Association, the average system price fell by 15 percent over the course of last year, building on progress that has been growing over the last few years.

This is promising news, but many utilities continue to discredit sun-generated electricity, and renewable power as a whole, often using the same, outdated rhetoric. Recently, Anthony J. Alexander, the CEO of First Energy, a major U.S. utility, explained that initiatives like renewable energy, distributed generation and roof top solar installation "sound good" but in practice, work counter to the way that energy industry has been operating over the last century.

"… [T]hese policies and others – designed to achieve a social agenda that has little, if anything, to do with maintaining electric service – are shifting the fixed costs of the system to customers who can least afford it… and are undermining our nation's competitive position," he explained to the U.S. Commerce Department.

Solar in practice
The problem with Alexander's argument is that it is based on the idea that the energy industry has been working without flaw over the past century. While energy supplies have been largely reliable in the U.S., they have been producing huge amounts of emissions that are leading to costs for which he did not account.

Whitehouse figures indicated that power plants within the U.S. produce roughly 40 percent of the country's greenhouse gas emissions. On top of this, the effects of global warming have been exacting tolls on the U.S. economy that are hurting the wallets of American citizens in more ways than one. For instance, Superstorm Sandy alone cost the U.S. economy an estimated $65 billion.

Further, in practice, renewable energy is proving to be supremely beneficial for people who want to cut down on their electricity bills. A residential solar customer who owns his or her own system can grow independent of his or her utility, meaning that he or she does not need to pay for fossil fuel generated electricity. There is an upfront cost of investment here, but returns are seen relatively quickly, and after the cost of installation is paid off, the resident can generate energy for free.

Solar leases are also available to those who are hesitant to make an upfront investment. In these agreements, the system is owned by a third party, and the power is sold back to the property owner. The rate at which it is sold is less expensive than that of the utility and again, reduces dependence on high-carbon emitting fossil fuels.

A sustainable investment
Another factor that Alexander neglected to consider is that the need for subsidies decreases with advancements in renewable technology. While fossil fuel companies will always need to invest in extracting fossil fuels, which cause their own environmental ills, solar energy will continually produce power once installed.

Recently, the United Nations released a new report that indicated worldwide invest for renewable energy dropped during 2013, however, this was not because of a loss in industry optimism, but because it simply is less expensive to make such an investment. The "Global Trends in Renewable Energy Investment 2014" report indicated that the investment drop during the year was in part because the cost of solar PV system itself is falling. Put simply, it is becoming less expensive to invest in solar energy.

In the U.S. this translated into a 41 percent increase in deployment, totaling around 4,751 megawatts during 2013. This means that the cost of solar is actually making it more common place and affordable, running counter to the rhetoric that Alexander sought to put forth.



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