Tuesday, March 31, 2009

FPL, solar and RECs: higher costs, fewer jobs and less clean energy for consumers

Interesting story last week in the Sarasota Herald Tribune outlines the battle over solar energy looming between big power companies like FPL and consumers, as the legislature is poised to pass a new energy law requiring power companies to generate 20 percent of their electricity from renewable sources by 2020.

The story, by Zac Anderson, points out that State legislators are favoring the system known as renewable energy credits, or RECS, which some business groups and environmentalists believe "would give windfall profits to large energy companies, cost consumers more and generate fewer local jobs and less clean energy."

The REC system would ...
... allow utilities to decide who can sell them solar energy based on a bidding process, resulting primarily in large, centralized solar developments. Opponents of the REC system say an alternative program, called a "feed-in tariff," encourages more small-scale solar development on homes and businesses by setting a price for solar energy that makes it profitable for anyone with open land or roof space. The system also forces electric utilities to buy energy from everyone.
And where does FPL fit in this story? The paper writes:
Florida Power & Light, the state's largest energy provider, criticizes feed-in tariffs as expensive and anti-competitive. So do representatives for large solar companies such as Maryland-based SunEdison, which has begun contracting with utilities to build big solar power plants in Florida. The deals have stirred intense infighting in the solar industry nationwide as small local businesses are pushed aside by larger corporations. Dismissing the Renewable Energy Lab's conclusions, FPL's vice president and chief development officer, Eric Silagy, said, "Any time you get into prescriptive government-set rates, you chill innovation."
And, why would FPL and other energy giants favor RECs? Take a guess ...
The REC system has resulted in substantially higher energy profits in places like New Jersey and the United Kingdom and much higher electricity prices for consumers than the more simplified feed-in tariff policy.
Read the full Sarasota Herald-Tribune story online, here.

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