The growth of clean electricity generation depends on policy decisions being made right now in Washington, D.C. While the Emergency Economic Stabilization Act of 2008 opened the utility-scale solar market by allowing utilities to use the 30-percent renewable energy investment tax credit (ITC), other policies and provisions are needed to accelerate the deployment of renewable energy sources, particularly solar photovoltaic (PV).
National Renewable Electricity Standard (RES)
An effective national RES should be progressive, with specific annual targets that step toward the medium- and longer-term goals. Regular, predictable annual market expansion will help the renewable energy sector to avoid "boom and bust" market cycles, allow companies to invest for the long term, and keep workers employed.
- Adoption of a strong national RES that would set a minimum goal of 10 percent of U.S. electricity to come from renewable sources by 2012, 20 percent by 2020 and 25 percent by 2025.
- Inclusion of a distributed generation "carve-out" or other mechanism to ensure that a genuine portfolio of renewable energy sources deploys.
- Establish compliance penalties and mechanisms with real teeth, so the cost of non-compliance is not cheaper and easier than compliance.
Increased Federal Government Procurement of Solar PV
The U.S. government is both the largest user of energy and the largest owner of buildings in the world with an electricity bill of nearly $6 billion annually. Solar PV can provide on-site power to reduce needs for fossil fuel electricity generation methods and the risks associated with it. Additionally, a vigorous federal procurement program would reduce carbon emissions and put thousands to work in the immediate future.
Federal agencies should also be authorized to enter into 25- or 30-year power purchase agreements (PPAs) to provide for longer amortization of project costs and to free agencies from the need to self-finance solar projects.
Clean Energy Bank (Green Bank)
Although the fuel is free, the upfront costs of renewable energy can be a deterrent. Creating a clean energy bank, or Green Bank, can help in the following ways:
- Capital costs of renewable energy can be lowered through low- or no-cost financing.
- The Energy Department's current loan guarantee program is not working effectively and should be streamlined and made part of a more nimble Green Bank.
- The Green Bank would make loans and loan guarantees and provide other forms of financing support for accelerated deployment of solar and other clean-energy and energy efficiency projects.
- The Green Bank should be initially capitalized at a minimum of $10 billion sufficient to guarantee up to $50 billion in new investments annually.
Other Policies
- Increase domestic solar panel manufacturing. Currently the vast majority of solar PV production occurs outside the United States. We must create internationally competitive incentives so that these jobs are created here in the United States, such as making the current, temporary, capped renewable energy manufacturing credit a permanent and regular part of the tax code.
- Establish an effective pricing mechanism for carbon emissions such as cap-and-trade, so the true costs of fossil fuels can be set, thus allowing market forces to drive greater adoption of solar PV and other low-carbon and renewable energies.
- Implement transparent and enforceable national interconnection and net-metering standards to end the patchwork of differing and often discriminatory rules that inhibit uptake of customer-sited solar electricity projects.
