By Mike Ferguson
(St. Charles, MO) – Missouri voters approved it in 2008 and, now, there’s some pushback on the cost of implementing what was known at “Proposition C.”
Kansas City Power and Light is asking state regulators for permission to limit the amount of rebates they spend when customers install solar panels on their homes or businesses. Customers of Kansas City Power and Light as well as Ameren Missouri are eligible for the program. That’s about half the population of the state, according to renewable energy advocates.
As part of the law created by Prop C, property owners can install the solar power on their buildings and then get a rebate for much of that cost. In other words, if you’re in KCP&L’s or Ameren’s service area, the power company is required to pay for part of your solar system. It’s part of the “Renewable Energy Standard” aspect of the law that requires an increasing reliance on renewable energy.
KCP&L says the cost is going up every year and wants to limit the amount it has to pay in rebates. In 2010, the company paid out around $350,000 in rebates. By 2012 that number was up to $12 million and the rebate cost for this year is on track to hit $51 million, according to KCP&L. The utility wants to cap the annual total cost for them at $21 million.
Renew Missouri, an environmental advocacy group that pushed for Prop C, is challenging that request.
P.J. Wilson is the group’s Director and says $51 million obviously sounds like a lot of money but don’t feel too bad for the power company when you put that figure in context. On a new “Missouri Viewpoints”, he says “Compared to the cost of a new coal power plant [$51 Million], it’s not [a lot of money]. The newest coal power plant that Kansas City Power and Light has was budgeted at around a billion dollars and actually one and a half billion dollars. So, when you compare that, it makes $50 million look like chump change to be paying for solar programs.”
An estimated one-percent of KCP&L customers are using the solar energy rebate program. Wilson points out that one-percent, though, is paying out of pocket to cover part of what are basically mini power plants.
The state’s Public Service Commission is still taking comments on the request.
Wilson says he worries that Ameren will follow suit and try to limit the rebate program if KCP&L gains the approval to cap the program in their area. “That’s not fair to customers that want to put up solar. It’s not fair to the solar installers themselves. And, really, fundamentally it doesn’t make much sense because what the utilities are saying is they want to take the cost that they are investing in these rebates that result in solar power systems that are online for ten, twenty, thirty years plus and they want to charge their customers immediately for them.
“They want to charge in 2013 for every dollar that they spend in 2013. Well, they don’t do that when they build a coal power plant. That would be unheard of.”
Wilson maintains that encouraging solar power in homes and businesses is not just a way for the state to reach renewable energy generation goals, but it’s a way to take pressure off the grid when power is in peak demand.
Between the rebates and tax incentives, much of the cost of installing a solar system can be covered. Missouri Solar Applications Vice President Mike Odneal explains. “Currently, the incentives that we have for certain areas from the investor-owned utilities will typically cover 40-percent of the cost of the system. And then the federal tax credit typically covers about thirty-percent of that cost.
While that helps, there’s still a significant up front cost, as normal solar power systems cost $30,000 to $50,000 before the rebates and tax incentives. That makes the cost to you after the incentives, typically, between $9,000 and $15,000.
Odneal says solar power companies will work with your current power provider to calculate how much power you need to generate. From there, a system can be designed with the specifics of your power usage in mind.
At the site level, several factors impact the overall cost of the system. That includes the available space on your roof and even the amount of shade affecting the building.
The bottom line is that installing a solar system on your property can, and likely will, eliminate your electric bill for decades but there is a significant upfront cost. What state regulators must now determine is how much help you can access for that cost.
On the web:
Renew Missouri: www.RenewMO.org
Missouri Solar Applications: www.MOSolarApps.com
Kansas City Power & Light: www.KCPL.com
Missouri Public Service Commission: www.PSC.mo.gov