Message from the Chair - Utilities Need to Embrace Roof Top Solar or Perish

Message from the Chair - Utilities Need to Embrace Roof Top Solar or Perish

Solar! Residential Solar! Rooftop Solar! Behind the meter solar! Solar and energy storage! These are all terms that utilities didn’t like to hear 25 to 30 years ago. Back then, it was not perceived as a potential threat to their industry. The technology was still in its infancy. Over the last 15 years though, these words have gained traction as more installations came online. Utility executives took note and wondered what to make of this evolving technology. Was it a passing fad, a status symbol for wealthy individuals?

They recognized its potential to reduce the ever-growing revenue stream on which their business model depends, making them uneasy. Plus, human nature resists new ideas and change. For almost a century, the utility industry never had to worry about perpetual growth in demand. Americans are hooked on electricity for every aspect of daily life: cell phones, laptops, air conditioning, entertainment media, etc. Energy (electricity in this context) has become like oxygen that we need to live.

But now, with efficiency on the rise, solar plus storage, and electric vehicles, the upward spiral of  demand for energy is leveling off. So, what should utilities do?

EMBRACE this energy boom!

Utilities are at a pivotal point in their evolution. They can embrace solar energy and storage. Does that mean lost revenue? Wrong!!! Here is why:

1- Rooftop solar helps to balance loads from the grid. It allows utilities to have a more predictable measure for those hot summer days without building “Peaker Plants,” which cost millions of dollars to build and run only when demand from the grid is too high for the primary plants to meet. When “Peaker Plants” are engaged, utilities charge ratepayers extra fees to cover the cost. With rooftop solar on homes and small businesses, the energy demand is reduced from the system, enough in many instances to eliminate the need for the redundant generation facilities.  

2 - Energy storage has hit the market with a vengeance. It has penetrated the residential market alongside solar to extend the effectiveness of solar generation. Over 50% of those who buy solar now add storage as well. Commercial solar is following suit. Why is this helpful to utilities? Again, it supports a more predictable load during high-demand periods by allowing customers to support their own demand loads on-site. Commercial businesses using machinery during hot summer days end up paying 15 to 100 times the customary rate on those days due to “demand charges.” Their on-site generation and storage helps offset those charges and they save money they can use for other business needs in their budgets.

3 - EVs are gaining market share in the U.S. ( Currently only 1.75%, EV adoption in the market may seem like a small number. However it’s changing and U.S. automakers are responding to their customers. By 2025, 75% of all automobiles sold in the US will be EVs. General Motors is building new plants to meet this demand that will create 15,000 new jobs. Mercedes Benz plans on having 15 model lines of EVs by 2023. Solar and storage will become part of the infrastructure that provides the demand for electricity this trend will create. Still, utilities will remain important to charging those cars.

4 - Solar is a clean form of energy as well as being more efficient. The problems associated with energy production from coal are well-documented. And the sustainable benefits of solar are unquestionable. The main objection to solar in the past was its cost, which has fallen precipitously over the past 10 years and is likely to decline further in the years ahead. Paired with storage, solar now provides a clean, 24/7 resource. Solar offers reliable, cost-effective energy with no noise, no emissions, no danger of radiation or airborne toxins and its free fuel resource is 92 million miles away.

5 – Solar has reached a new benchmark for efficiency in relation to cost. In the decade-plus I have been in the energy industry, I have seen solar evolve from one of the most expensive forms of energy all the way down to the second-most affordable, next to natural gas and hydropower. It has now surpassed the efficiency / cost ratio of both coal and nuclear. Why? Fewer moving parts and lower maintenance, plus solar is part of a global energy trend, with a bonus of no emissions.

6 – Solar is creating thousands of living-wage, local jobs. I am talking real jobs. The solar job market is growing at a pace 12 times faster than U.S. economic growth. ( It has created a plethora of career choices for both young people just entering the workforce and older workers displaced in other sectors of the market. Utilities can create internal awareness and participate in recruiting, training and hiring this new workforce by embracing renewables. Utilities will need installers, engineers, technicians, IT, accounting and legal advisors, and O & M managers, just to name a few. By retraining their own people, utilities will have become more flexible and diverse.

In short, utilities will continue to grow, but they also need to evolve with technology and cultural trends. With all of the new home construction and International companies opening regional operations, utilities can support regional economic development efforts with access to renewable energy and site-based generation. Working together, utilities and the solar industry can expand energy choice, support technological innovation and create economic growth that benefits us all.

Creating barriers to solar energy for homeowners and small businesses can only stifle growth, dull our competitive edge in the market for economic development, and deter the innovation that clean energy supports. The choice seems very clear.

Thank you and have a Great Solar Day!

Russell Seifert
Georgia Solar Chair

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