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Small-scale solar's big potential goes untapped

Modest-size projects can produce electricity at a lower cost to consumers and the environment, but financing goes to big plants.

December 29, 2012|By Julie Cart, Los Angeles Times
  • Gerald Freeman is reflected in panels of the small solar plant that provides 70 kilowatts to the town of Nipton, Calif., which is about 80% of the power required by Nipton's 60 residents, its general store and motel.
Gerald Freeman is reflected in panels of the small solar plant that provides… (Mark Boster, Los Angeles…)

NIPTON, Calif. — Gerald Freeman unlocks the gate to the small power plant and goes inside. Three rows of solar collectors, elevated on troughs that track the sun's arc like sunflowers, afford a glimpse of California's possible energy future.

This facility and a smaller version across the road produce some 70 kilowatts of electricity, about 80% of the power required by Nipton's 60 residents, its general store and motel.

Freeman, a Caltech-trained geologist and one-time gold mine owner, understood when he bought this former ghost town near the Nevada border that being off the grid didn't have to mean going without power.

PHOTOS: Solar power in Nipton, Calif.

He contracted with a Bay Area company to install solar arrays on two plots of land. The town has a 20-year agreement to buy its power at a below-market rate.

Projects like these make do with scant financing opportunities and little support from the federal government.

The Obama administration's solar-power initiative has fast-tracked large-scale plants, fueled by low-interest, government-guaranteed loans that cover up to 80% of construction costs. In all, the federal government has paid out more than $16 billion for renewable-energy projects.

Those large-scale projects are financially efficient for developers, but their size creates transmission inefficiencies and higher costs for ratepayers.

Smaller alternatives, from rooftop solar to small- and medium-sized plants, can do the opposite.

Collectively, modest-sized projects could provide an enormous electricity boost — and do so for less cost to consumers and less environmental damage to the desert areas where most are located, say advocates of small-scale solar power.

Recent studies project that California could derive a substantial percentage of its energy needs from rooftop solar installations, whether on suburban homes or city roofs or atop big-box stores.


Janine Blaeloch, director of the nonprofit Western Lands Project, said smaller plants were never on the table when the federal solar policy was conceived early in President Obama's first term.

Utilities and solar developers wanted big plants, so that's what's sprouting in Western deserts, she said.

"There was a pivot point when they could have gone to the less-damaging alternative," Blaeloch said, referring to both federal officials and environmental groups that have supported large-scale solar projects.

"There's no question that it was a matter of choice, and it was the wrong choice."

Built in far-flung locations where there is plenty of open land, large-scale plants require utilities to put up extensive transmission lines to connect to the grid.

Utilities charge ratepayers for every dollar spent building transmission lines, for which the state of California guarantees utilities an annual return of 11% for 40 years.

By comparison, small-scale plants can be built near population centers and provide power directly to consumers, reducing the demand for electricity from the grid.

Rooftop solar goes one step further.

It not only cuts demand from the grid, but also can allow homeowners and businesses to sell back excess power.


Falling start-up costs also have brought solar power within reach for many homeowners and small businesses.

In the last six years, the cost in Los Angeles to install a medium-sized solar system — between 50 kilowatts and 1 megawatt — has fallen by 55%, said J.R. DeShazo, an environmental economist at UCLA's Luskin School of Public Affairs.

Even though prices are coming down, Ray Brady, manager of the federal Bureau of Land Management's renewable-energy program, said he has seen little interest in smaller-scale projects.

The agency has policies that provide incentives for developers to build smaller solar plants on federal land, including exempting projects from costly and time-consuming environmental reviews.

But Brady said that he could think of none in the works.

"We can only respond where there is an industry interest to do so," he said, citing economies of scale that can make large power plants more cost-effective for developers.

The state has been more proactive in encouraging smaller projects.

Gov. Jerry Brown's California Solar Initiative has set a target of 12,000 megawatts of energy derived from rooftop panels.

The program offers support for home builders who construct super-energy-efficient homes with photovoltaic panels.

The California Energy Commission is running another program, the $400-million New Solar Homes Partnership, with a goal of installing 400 megawatts by 2016.

Evan Gillespie, who heads up the Sierra Club's renewable-energy programs in California, has worked to bring more uniformity to fees and permitting for rooftop solar, a statewide effort that he says has reduced the cost of a small residential system by $2,500.

"We want to make sure that in the next two to three years we are removing as much friction from the marketplace as possible," he said.

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