Published Originally by Fort Lauderdale’s Sun Sentinel December 9, 2016
“Lowered Solar Panel Prices, the defeat of Amendment One, Extended Federal Tax Credits and Growing Environmental Concerns means Mostly Sunny Days Ahead for Florida Solar Energy Installers” Ray Johnson Founder & President Florida Solar One
Solar industry advocates in Florida are forecasting a mostly sunny future with just a few uncertainties after voters failed to approve a constitutional amendment supported by big utilities in a bitter election battle.
A sign of the increased confidence was an announcement on Dec. 1 by SolarCity, the nation’s largest installer, of plans to expand its operations into Florida.
“The industry is evolving almost as rapidly as cell phones these days,” said Ray Johnson, president and founder of Fort Lauderdale-based Florida Solar One, one of Solar Power World magazine’s 500 most influential solar contractors in North America in 2015. “Solar panels are priced at an all-time low and are now 500 percent cheaper than they were eight years ago.”
Interest is also being driven by improvements in storage technology and electronics that control and regulate electricity flows, growing demand for electric vehicle charging stations and “smart home” technology. Another lift came from the federal government’s extension through 2019 of a 30-percent tax credit for solar installations, Johnson said.
“Many of the modern custom home builders are contacting us to professionally engineer these highly specialized and advanced home electrical systems and the pace of these inquiries has never been higher,” he said.
But even as the amendment battle gave the solar industry untold millions of dollars worth of free advertising, uncertainty over the next moves by Florida’s electric utilities is preventing solar from gaining even more traction among homeowners, says Patrick Altier, an Ocala solar installer and president of the Florida Solar Energy Industries Association.
The failure of Amendment 1 to garner more than 60 percent of the vote prevented enshrinement of a decree utilities said was meant to protect non-solar users from subsidizing solar users’ connection to the grid.
Opponents contended that language was meant to give the utilities legal standing to push for repeal of state rules requiring them to buy back excess electricity from residential solar users at retail rates. The utilities, including Juno Beach-based Florida Power & Light, maintained they hadn’t decided what they would do if the amendment was enacted.
Just because the amendment was defeated, solar advocates counter, doesn’t mean utilities won’t try new strategies to end the buy-back requirement — known as “net metering.” The state’s two largest utilities, FPL and Duke Energy, have asked the state Public Service Commission to address net metering, the Miami Herald reported on Nov. 12.
Elimination of net metering, coupled with an increase in the $16 to $30 charge solar users pay each month to connect to the electric grid would drive up the long-term cost of ownership of solar systems, Altier said, and even double the length of time from 10 to 20 years it takes for an owner’s investment to be repaid by utility bill savings.
“That uncertainty is one of the biggest things that keep people from adopting solar and moving forward,” he said. “Having to tell the customer, ‘I don’t know what it’s going to be’ turns into a deal killer.”
The association would like to negotiate an agreement with the utilities during the next legislative session that would eliminate the uncertainty. “Whatever it may be — let the chips fall,” he said. “Then I could go to my customer and say ‘Here’s what it’s going to be. It’s not going to change.'”
The association would also like to see the Legislature quickly enact Amendment 4 — the one voters approved in August with solar industry approval and no opposition from the big utilities. That amendment exempts solar systems from property taxes and is seen as mainly benefiting commercial businesses. Quick enactment will encourage more businesses to install solar, Altier said.
Even in the current climate of uncertainty, the national Solar Energy Industries Association predicts that solar capacity in Florida will increase by 2,315 megawatts over the next five years — nearly 20 times the current installed capacity of 248 megawatts.
Florida, the third-most populous state in the nation, ranked 13th in total installed solar capacity in 2015, according to a report by the Smart Electric Power Alliance. The state ranked 14th in the nation for capacity generated by residential systems — 58.5 megawatts.
But in a comparison of residential solar capacity per household, Florida ranked 26th. The top five, in order, was Hawaii, California, Arizona, Vermont and Massachusetts. Also above Florida were Louisiana, Maryland, Montana, Rhode Island and Texas.
Helping the state make up lost ground will be SolarCity, the nation’s largest manufacturer of solar systems. On Dec. 1, the company, chaired by Tesla Motors founder Elon Musk, announced plans to expand its Florida operations. The decision was directly related to the defeat of Amendment 1, the company said.
SolarCity plans to base its expansion at an existing installation facility in Clermont and serve customers of Duke Energy and Orlando Utilities Commission, the company said in a statement. Further plans call for expansion “to additional areas of the state in the coming months,” the statement said.
According to the Orlando Sentinel, SolarCity recently began making loans to help make the systems and installations available to area homeowners.
Ed Strobel, owner of Sunshine Solar Services in Fort Lauderdale, said he doubts SolarCity’s Florida expansion plans include a rapid move to South Florida “because installing in these conditions is very specialized and to do it correctly, a different engineering mindset is required.”
South Florida has stricter wind codes, requiring more attachment hardware, Strobel said. In addition, the area has more homes with tile roofs, and they also require more labor and hardware. The price difference can be as much as $7,000 more to install a typical 10,000-watt system, he said.
SolarCity officials did not respond to requests for an interview for this story. But in an email, Will Craven, director, policy & electricity markets for the company, said the company has no current plans to expand further in the state.
Addressing Strobel’s statement about about South Florida’s stricter installation requirements, Craven said, “all of our products and installation methods are manufactured, designed and engineered to exceed local and state building codes and standards including regionalized wind uplift standards.”
Johnson of Florida Solar One said Florida’s smaller solar providers are worried about the high-volume provider’s entry. “None are happy and all are very concerned,” he said. “This is like Wal-Mart moving into a small town.”
Altier said he welcomes SolarCity and expects the company to force him and other mom-and-pop solar providers to become more competitive. “I want to see SolarCity do a ton of installations,” he said. “It will make us sharpen our pencils and bring down the cost of installation.
“I’m glad to see them. I want to beat them.” says Altier