Building a Solar Cincinnati - environmentohiocenter.org · Building a Solar Cincinnati The authors...

How the Queen City can harness the sun to power its future

Building a Solar Cincinnati

Fall 2012

Written byChristian Adams and Julian Boggs

Environment Ohio Research & Policy Center

How the Queen City can harness the sun to power its future

Building a Solar Cincinnati

The authors wish to thank Steve Melink of Melink Corporation, Anya Schoolman of Community Power Project and Rob Sargent of the Environment America Research & Policy Center for their insightful comments on drafts of this report. And also thanks to Tony Dutzik at Frontier Group for editorial support.

The authors bear responsibility for any factual errors. The recommendations are those of Environment Ohio Research & Policy Center. The views expressed in this reports are those of the authors and do not necessarily reflect the views of our funders or those who provided review.

©2012 Environment Ohio Research & Policy Center

Environment Ohio Research & Policy Center is a 501(c)(3) organization. We are dedicated to protecting our air, water and open spaces. We investigate problems, craft solutions, educate the public and decision-makers, and help the public make their voices heard in local, state and national debates over the quality of our environment and our lives. For more information about Environment Ohio Research & Policy Center, or for additional copies of this report, please visit www.environmentohiocenter.org.

Cover Photo Credit: Melink Corporation

Design: To the Point Publications, www.tothepointpublications.com

Acknowledgments

Table of Contents

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

Why Solar? Why Cincinnati? . . . . . . . . . . . . . . . . . . . . . .8Fossil Fuels: Dirty, Dangerous and Outdated . . . . . . . . . . . . . . . . . . . . . . . . . 8

Solar is 21st Century Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Setting the Stage: Ohio Solar Policy Environment. . . . . . . . . . . . . . . . . . . . . 10

Cincinnati: Queen City to Solar City. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Identifying Key Policy Areas . . . . . . . . . . . . . . . . . . . . .13Leading-By-Example . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Getting the Finances Right . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Building Solar Finance Literacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Policy Recommendations . . . . . . . . . . . . . . . . . . . . . . .18

Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

4 Building a Solar Cincinnati: How the Queen City can harness the sun to power its future

Executive Summary

Cincinnati can become a solar city. By collaborating with local businesses, anchor institutions

and the green community, city leaders can pave the way for a homegrown solar economy. The Cincinnati public is engaged and eager to embrace more solar power. To replace the dirty, dangerous and outdated energy sources of the past and meet public demand, city government alongside civic and corporate partners should adopt a visionary goal of getting at least 10 percent of Cincinnati’s energy from solar power by 2030. By leading-by-example, getting the finances right and building public literacy of solar options, the city of Cincinnati can surmount today’s obstacles and build a green legacy for current and future

generations. By targeting key policy areas the city can remove the barriers to “going solar” and with public education and outreach, leading-by-example projects, and securing greater access to financing options, Cincinnati can make this solar vision a reality.

• Ohio still gets 82 percent of its electricity from burning coal, the dirtiest source of energy. Ohio’s dependence on coal threatens public health and the environment, placing Ohioans at risk for increased respira-tory disease, premature deaths and developmental disorders.

• Solar energy is a powerful solution to these environmental problems and Ohio has great potential to go solar. Southwest Ohio’s solar resources

Executive Summary 5

are among the richest 70 percent in the United States, besting world solar leader Germany.

• The solar industry is rapidly matur-ing. Solar energy is pollution-free, proven and available everywhere. Technology improvements along-side innovative business and financ-ing models have driven costs to all time lows, but multiple barriers remain to full scale implementation.

• Solar investments will keep energy jobs in the city – allowing residents to invest in their own infrastructure and stop exporting their energy dollars outside of the city.

• Thanks to a healthy business environment, state and federal level incentives, and city leadership in pursuing a green agenda, Cincinnati is well positioned to become the region’s solar hub.

The city of Cincinnati should con-tinue to lead-by-example in solar en-ergy by expanding municipal projects and linking new and existing projects to education and outreach efforts.

• The city of Cincinnati already has 21 solar installations to date located throughout the city. While this is a good beginning, it scratches the surface of what is possible.

• In order to have maximum impact, public visibility should be tied in to site selection procedures for optimal installation sites.

• Engaging with other institutions – hospitals, universities, and schools – Cincinnati can build partnerships and achieve a greater impact than as a municipality alone.

• Pursuing virtual-net metering at the state level would expand the list of viable solar installation sites.

Cincinnati has great solar po-tential, but that potential will not be realized unless the city tackles financial barriers to solar installa-tions for commercial and residential customers. Public-private partner-ships and community projects can pave the way for easy access to solar financing.

• Third party financing can do much to overcome customer inertia and the prohibitive upfront costs of solar projects. Power purchase agreements and solar leases promoted and facilitated by city government can connect interested homeowners and businesses to financial capital and solar installers.

City officials, solar businesses, and the green community should col-laborate to promote public under-standing and solar literacy through aggressive citizen outreach and education initiatives.

• Public education programs by city and community partners can answer consumer’s questions about solar energy financing and dispel inaccurate perceptions about solar feasibility.

• A designated Solar Coordinator in the Office of Environmental Quality would provide a single point person for customers and businesses to contact for informa-tion and ensure coordinated and strategic efforts for solar initiatives.

• Developing a central, easy-to-use web site or social marketing site where consumers can investigate options, view case studies and learn about current projects would enhance Cincinnati’s profile as a solar city and boost local demand for solar energy.


Introduction

What could a solar Cincinnati look like?

Picture this: the year is 2030. You wake up in a home heated by solar thermal heating system, which efficiently trans-forms the sunlight into heat. To get to work, you unplug your car from the elec-tric outlet connected to the photovoltaic panels on your roof. On the commute, you pass by a local solar panel manufac-turing plant and a solar farm, where 10 acres of panels manufactured at the plant cover an abandoned field. You drop your kids off at the local middle school, which gets half its power from a rooftop array. In your daughter’s science class, students use the panels to study how sunlight can create electricity. Downtown, you park

your car under the solar canopy at work, and plug in to recharge for the day.

Local solar provides 10 percent of the city’s total energy, and, combined with wind power, energy efficiency, and sus-tainable biomass, has replaced the need for every coal-fired power plant in the region. The solar industry has revitalized Cincinnati’s economy, and continues to be its largest growth sector. Cincinnati meteorologists no longer use the words “bad air day.”

This vision is not as far from reality as you might think – in fact, the technology exists today to make this solar future a reality and Cincinnati is ready. The city’s combination of public leadership, an en-gaged sustainably-minded citizenry, and

Introduction 7

a budding solar business sector strategi-cally place the Queen City to become Ohio’s solar energy hub. Evidence of this blend of public-private synergy is not hard to find. Take the Cincinnati Zoo for example. When you enter the park zoo-goers were once greeted by a sea of asphalt, but now visitors are shaded by the cool blue-crystalline and steel contours of the Cincinnati Zoo Solar Canopy. Owned and operated by local clean energy leader Melink Corp, the 6,400 panel, 1.56 mega-watt, array generates enough power to meet 20 percent of the Zoo’s energy needs – enough electricity to power over 200 homes each year. On sunny days, the zoo exceeds its needs and sends power back to the grid. When unveiled the Cincin-nati Zoo rightly touted its canopy as the “largest publically accessible urban array” in the country – cementing its reputation as the greenest zoo in America.

The technical and educational merit of the canopy are obvious – but equally impressive are the partnerships that made the project a reality. The Zoo’s Solar Canopy brought together a coali-tion – solar installer and designer, Melink

Corporation, PNC Bank, Uptown Con-sortium, National Development Council, FirstEnergy Solutions, and Cincinnati State Technical & Community College. By uniting a diverse group of civic in-stitutions, educators, financial partners, and local clean energy innovators, the canopy project made a statement about local ingenuity, drive, and commitment to a green future. The Zoo’s Solar Canopy enriches a Cincinnati institution, offers lessons on leadership and cooperation, and demonstrates how bold vision and determination can make Cincinnati a solar city.1

The city’s combination of public leadership, an engaged sustainably-minded citizenry, and a budding solar business sector strategically place the Queen City to become Ohio’s solar energy hub.


America has reached a point where we can no longer afford to ignore the dirty, dangerous and outdated

dimensions of our energy system. To meet 21st century challenges, we are going to need 21st century energy. Solar energy technologies are a powerful solution to these challenges. Cincinnati has an opportunity to embrace this vision of a cleaner, healthier future by laying the foundations for a homegrown solar energy economy.

Fossil Fuels: Dirty, Dangerous and Outdated

The vast majority of America’s en-ergy comes from fossil fuels. In 2006,

the United States spent $921.2 billion2 – nearly 7 percent of its gross domes-tic product and 9 cents of every dollar spent – on fossil fuels3. In Ohio, most of our electricity continues to be generated from coal-fired power plants, the dirtiest source of electric power. In 2011, coal accounted for 82 percent of Ohio’s elec-tricity generation.4 This coal is costly and much of it comes from out of state – Ohio imported, on net, 32.7 million tons of coal at a $1.5 billion price tag.5 Billions of dollars is not chump change, but the biggest cost of coal is the one we don’t see up front – the price we pay in damages to our environment and health.

The environmental impact of coal and other fossil fuels are diverse in scope and scale, from the deeply local harm of an Appalachian stream fouled by mine

Why Solar? Why Cincinnati?

Why Solar? Why Cincinnati? 9

waste to the existential threat of global climate change. In 2009 Ohio’s power sector emitted 624,000 metric tons of sulfur dioxide, the primary component of acid rain, which can devastate forests and depopulate lakes.6 Mountaintop removal mining has claimed over 500 named peaks in Appalachia, reducing majestic hills and diverse ecosystems to homog-enous lumps of grass and rubble. As tragic as these impacts are, none compare to the looming long-term threat of global warming. Global warming is happening now and its effects are impacting daily lives in the United States and around the world. In 2009, Ohio’s power sector alone pumped 1.8 million metric tons of carbon dioxide into the atmosphere – the third most of any state.7 As carbon and other greenhouse gases heat our planet, extreme weather events become more likely. The drought of 2012 was the worst in 25 years, affecting 80 percent of U.S. agricultural land, causing billions of dol-lars in crop losses, and costing consumers through increased food prices.8

Our dependence on dirty energy also threatens public health. Much more than a simple hydrocarbon, coal harbors a hidden cocktail of dangerous chemicals. The American Lung Association (ALA) lists 84 known hazardous air pollutants from coal-fired power plants alone, in-cluding arsenic, dioxins, formaldehyde and hydrogen chloride.9 Ohio’s electric power sector ranks fifth in the nation for nitrogen oxide emissions – a major component of smog – dumping 110,000 metric tons into the air each year.10 Over time, low levels of smog can cause and exacerbate a host of health problems, from asthma to lung cancer, while high levels can provoke acute breathing dif-ficulties, sending vulnerable people to the emergency room.11 Cincinnati ranks eighth-worst in the nation for air particu-late pollution, while Hamilton County received grades of F for ozone and D for

air particle pollution from the ALA.12 Coal is also a leading emitter of mercury, a dangerous neurotoxin. Mercury can have powerful developmental effects – exposure to children in utero can cause lasting mental impairment and retarda-tion.13 One in ten American women of childbearing age has enough mercury in her blood-stream to put her children at risk if she becomes pregnant14, and many waterways are so contaminated that the fish are unsafe to eat. Ohio’s power plants emitted over 4,200 pounds of airborne mercury in 2010, the second highest of any state.15

Natural gas is often presented as a fossil fuel solution to dirtier sources like coal. However, natural gas, particularly that derived from hydraulic fracturing or “fracking,” is already taking its toll on our environment, economy and health. Fracking threatens public health through drinking water contamination and toxic substance exposure from waste water and fracking fluid – in Colorado the clean-up of a natural gas seep has cost hundreds of thousands of dollars over the past 8 years, while increased air pollution in Arkansas’ Fayetteville Shale has imposed over $10 million in health care costs to the community. Fracking and attendant activities strain the limits of our public infrastructure and ser-vices – in Pennsylvania alone, the state estimated in 2010 that is would require $265 million to repair damaged roads in the Marcellus Shale region. Finally, natural gas extraction through fracking imposes a horrific cost on our natural resources and special places. Deforesta-tion and conversion of agricultural lands for fracking purposes alters our natural landscape – causing increased runoff pollution and fragmented habitats.16 In Ohio, many of our special places are being explored for drilling – Hocking Hills State Park is already under threat from drilling companies.


The widespread and severe costs of our dependency of dirty energy sources pro-vide a compelling case for moving beyond the fossil fuels of the past and embracing clean, renewable energy sources that ex-ist right now. Fossil fuels are the aging relics of a time where we could afford to ignore the dirty and dangerous effects our energy system, but that time has passed. Solar energy technologies are a powerful solution to the environmental damages of fossil fuels and by embracing solar power we can meet the challenge of building a clean 21st century energy economy.

Solar is 21st Century Energy

Solar energy is safe, clean, proven and available everywhere. In addition to envi-ronmental and public health benefits, so-lar energy investments contribute to local economic growth, jobs and energy inde-pendence. Photovoltaic (PV) cells, solar thermal and solar hot water technologies 17 now offer an array of means to capture and store the sun’s energy, and we have seen great progress. Policies from state and federal agencies have set the condi-tions for an industry boom, and the pace of growth and innovation has reached a clip rivaling other high-tech sectors – energy-related segments of the clean economy added jobs at a torrid pace over the last few years, bucking trends of the Great Recession.18 This innovation has driven down the cost of solar power, and the price of a commercial-scale rooftop system could be reduced 40 percent by 2015 and a further 30 percent by 2020.19

Ohio has great potential for solar en-ergy and we are already taking advantage of this bountiful and tremendously flex-ible source of power. A 2008 National Renewable Energy Laboratory study concluded that by 2015, Ohio would

have the potential to install more than 26 gigawatts (GW) of solar on residential and commercial rooftops alone.20 Those panels would meet more than half of the electricity needs of Ohio homes in a year – 34,000 gigawatt-hours. Ohio has greater solar potential than Germany – the world solar leader – and southwest Ohio’s resources are among the top 70 percent in the U.S.21

Investing in solar would help pro-tect Ohio’s environment and health by displacing dirty fossil fuels. Life-cycle analyses of PV systems show that they dramatically reduce emissions of both smog- and soot-forming pollutants and greenhouse gases, even when their manufacture is taken into account. PV emissions reductions are as high as 89 to 98 percent over the life of the system.22

The “energy payback” time for photovol-taics – the time required to save as much energy as was used to produce the system – ranges from three to four years, and is decreasing over time. PV systems can last as long as 40 years, but assuming just a 30 year timeframe still yields 26 to 27 years for true fossil fuel-free electricity.23 Solar hot water is another important part of the picture. By fully taking advantage of America’s resources we avoid 52 million metric tons of carbon pollution, reducing natural gas consumption by 2.5 percent and electricity usage by 1 percent.24 The environmental, health, and economic benefits of solar energy add up to make solar a smart investment.

Setting the Stage: Ohio Solar Policy Environment

Ohio is already beginning to make the investments it needs to transition to pollution-free renewable energy like solar power. State policies are helping to move Ohio forward by creating a pro-solar

Why Solar? Why Cincinnati? 11

regulatory environment and offering financial incentives for solar installations. The chief components of Ohio’s solar regulatory environment are as follows.25

Solar Renewable Energy Credits Solar Renewable Energy Credits

(SRECs) provide one of the main state incentives for solar power installations. In 2008, Ohio passed Senate Bill 221 – also known as Ohio’s Clean Energy Law – which commits Ohio’s utilities to pro-viding at least 12.5 percent of their elec-tricity from renewable sources by 2025. The renewable portfolio standard (RPS) includes a modest solar carve-out requir-ing 0.5 percent of the state’s total energy supply to come from solar by 2025. To meet their annual benchmarks, utilities must earn SRECs by performing their own solar installations or purchase them from third-parties and most of Ohio’s major utilities – including Duke and First Energy – have set up utility renewable energy credit purchase programs.

Property Assessed Clean Energy Property Assessed Clean Energy

(PACE) is a financing tool which allows property owners to borrow money to pay for energy improvements via a special as-sessment on the property itself paid over a period of years. PACE financing effec-tively acts like a second mortgage tied to the property itself instead of the owner. In 2009 Ohio enacted legislation allow-ing local municipalities and townships to establish special energy improvement districts (SEIDs) – designated areas in which PACE financing is approved – for the purpose of financing for solar PV and solar thermal systems. However, at pres-ent the state of PACE in Ohio is unclear

– in 2010 the Federal Housing Financing Agency (FHFA), at the behest of Fannie-Mae and Freddie-Mac, raised concern that Ohio and other state governments were granting senior lien status to PACE loans over traditional mortgages and PACE for residential properties is on hold pending further clarification.26

Tax Exemptions & Low-interest Loans

Ohio’s state government offers a num-ber of special tax exemptions and low interest loan options for clean energy investments. Tax credits and exemptions include the Energy Conversion Facilities Sales Tax Exemption, Air-Quality Im-provement Tax Incentives, and Qualified Energy Property Tax Exemptions. In addition to tax breaks, the state has set up two revolving loan funds – the Energy Loan Fund and Advanced Energy Fund – for energy projects and solar energy projects can also qualify for the Energy Conservation for Ohioans (ECO-Link) Program.

Improvements to Rules & Regulations

Beyond the statewide RPS, Ohio has also enacted a number of rules and regulations to protect the rights of solar energy system owners. Interconnec-tion standards allow solar power users to connect their systems into exist-ing infrastructure while net metering ensures that solar system owners are compensated for the excess energy they return to the grid. Ohio has solar ease-ment laws protecting Ohioans’ right to adequate sunlight and setbacks for solar installations.


Cincinnati: Queen City to Solar City

Cincinnati is uniquely positioned among metro areas in Ohio to become a leader in clean, renewable, homegrown solar power. Its city government has been serious and proactive in pursuing a green, sustainable vision through the Green Cincinnati Plan.27 The Office of Envi-ronmental Quality – established in 2007 – has lead the way with municipal instal-lations and advocacy. Anchor institutions and corporate leaders have also shown their desire to go solar. The Cincinnati Zoo Solar Canopy is viewed by over 1.31 million visitors annually – solidifying the zoo’s reputation as the “greenest zoo in America.”28 Macy’s Inc., a major employer with corporate headquarters located in downtown Cincinnati, is one of the top five solar power users in the country29 and Fifth-Third Bank recently announced its interest in funding more solar proj-

ects.30 This leadership has stimulated a burgeoning local solar market with dozens of homegrown solar installers and power producers located in the greater Cincinnati area. This maturing solar marketplace, statewide incentives and citywide commitments have set the stage for Cincinnati to become a solar city. The city of Cincinnati should secure this future by making an am-bitious but achievable goal of getting 10 percent of the city’s energy from solar by 2030. State and local policies have made this goal feasible, but many barriers remain to block this vision, es-pecially for residential and commercial installations. Cincinnati can and should continue to take advantage of state and federal incentives, but by acting strate-gically, Cincinnati can identify holes in state programs and address obstacles by implementing local policies that open solar access to residents, businesses, and neighborhoods.

Identifying Key Policy Areas 13

Identifying Key Policy Areas

The city government has a critical role to play in realizing the vision of a solar Cincinnati. The Cincinnati

public is engaged and eager to embrace more solar power.32 To meet a goal of 10 percent by 2030, the city should partner with businesses, nonprofits, and anchor institutions to remove the local barriers to solar power – particularly the lack of public literacy of solar financing options and the upfront costs of solar installations. The city of Cincinnati has a clear opportunity to articulate this vision and address the main obstacles to solar as it revises the next five year installment of its Green Cincinnati Plan. By leading by example, getting the finances right and building local literacy about finance options for solar, Cincinnati can realize its full potential.

Leading-By-ExampleCincinnati’s city government can

show leadership by integrating solar energy technologies into municipal facilities and properties. Cities can lead by example in a number of ways – by indentifying optimal installation loca-tions, standardizing solicitations for solar installations, selecting the appropriate financing mechanism, commission-ing solar energy systems and ensuring quality operations. Cincinnati has made progress on this front – to date, the city has 21 municipal installations totaling 1 MW of capacity. The city should build upon this groundwork and use its clout to convince other community leaders and institutions to lead-by-example on solar locally.


Best Practice in Action: Building Partnerships and Setting Bold Goals in Ann Arbor, Michigan33

In 2007 Ann Arbor was named a Solar America City by the U.S. Department of Energy. Ann Arbor began its Solar America Cities project with a number of programs already in place – approxi-mately 86 kilowatts of installed photovol-taic capacity and 19 solar water heating installations, an number of highly visible public installations with an educational component, specific renewable energy goals at the local and state level, a limited net metering program, and a dedicated city energy programs manager staff posi-tion. Through the Solar America Cities partnership, however, the city was able to set ambitious goals to install 5,000 solar energy systems and obtain 20 percent of the city’s energy from renewable sources by 2015. To achieve this vision, the city developed and accepted a formal Solar Plan, installed multiple systems in public

locations with performance monitoring – including a 10 kW PV system at the Farmer’s Market, created a solar map to help consumers determine site feasibility, used city projects to train local installers, and built partnerships with local civic insti-tutions to overcome barriers to solar. The partnerships that emerged from the Solar America Cities project in Ann Arbor are helping to carry the city forward towards its renewable energy goals – in particular, the University of Michigan was an invalu-able resource to the city. Cincinnati’s solar potential is greater than Ann Arbor and has similar government vision, commitments, and institutional resources to meet its own goals and vision.

Best Practice in Action: Leading the Way in Municipal Installations in Alameda County, CA34

Alameda County in northern California has been leading the way in municipal in-stallations since the early 2000s. County

State Policy Highlight – Virtual Net-MeteringThis publication is focused on actions that the city of Cincinnati and other

municipalities can take to grow the local solar economy. But of course, state and federal policies play a major role in improving or impeding a community’s ability to take advantage of solar opportunities. One example is ‘virtual’ net-metering. Traditional net-metering allows utility customers to generate on-site electricity and sell excess production back to the grid in the form of net-metering credits. Because sunlight intensity varies throughout the day, net-metering allows power producers to still benefit from times where their energy production exceeds their use. In Ohio, net-metering credits are required to be used at the same site where they are produced – making some high-capacity but low-energy use sites undesirable for solar installations and vice versa. Virtual net-metering decouples the site where net-metering credits are produced from where they are used. For example, the city of Cincinnati could install a solar array on a undeveloped land-fill site and apply the accrued net-metering credits for a court house of other municipal building located elsewhere. A virtual net-metering policy in Ohio would allow the city of Cincinnati to take advantage of additional sites for solar installations.


residents and leaders decided early that generating its own renewable energy from solar would meet its goals of reduc-ing green house gas emissions and saving taxpayer dollars. To date, Alameda has installed 3.5 megawatts of capacity on municipal buildings – for a total of over 19,000 panels – making it the largest solar energy producing county govern-ment in the country. Its Santa Rita Jail installation – completed in 2002 – alone covers 3 acres and has 1.18 MW capac-ity.35 With its 11 large-scale solar instal-lations, Alameda will prevent over 38,600 tons of carbon emissions over the next 30 years, generate enough daily electric-ity to power over 3,000 homes, and save county taxpayers $700,000 a year on county electric bills. Alameda has won numerous awards and accolades for being a pioneer in solar power and serves as a model for what community leadership can achieve in building local renewable energy economies.

Getting the Finances Right

One of the primary barriers to increas-ing the volume of local solar installations in Cincinnati is the upfront cost. While the economics of solar systems are sound – systems pay themselves back over time through energy savings and participation in the state SREC market and other fi-nancial incentives – the high initial invest-ment is often prohibitive for residential and small to medium sized commercial properties. While the cost of solar has dropped significantly in recent years and prices are expected to decline even more in the future, the city of Cincinnati can act now by collaborating with nonprof-its, solar companies, utilities, and solar companies to enable greater access to new financing options for distributed solar projects. Financing innovation is one of

the main drivers behind shrinking “soft costs” – costs not associated with physical components, e.g. installation, planning, permitting, etc. – of solar projects and policy-makers now have many selections from which to choose. Another major cost barrier is customer acquisition. 36 By developing programs linking the public to solar installers, the city and solar ad-vocates can help overcome this obstacle. Third-party financing tools like solar leases and power purchase agreements have a proven track record in Cincinnati – both the Cincinnati Zoo and the city of Cincinnati have taken advantage of these tools – but the city can do more to expand these options to smaller residential and commercial scale projects.

Best Practice in Action: Building Access to Third-Party Financing in Phoenix, Arizona – Solar Phoenix 2 37

Solar Phoenix 2 is an ongoing partner-ship between the City of Phoenix, solar leasing company Paramount Solar, utili-ties Arizona Public Service (APS) and Salt River Project (SRP), and the National Bank of Arizona. Participating residents can install a solar energy system with zero up-front costs locking in current market electricity rates, immediately saving participants between 10 and 20 percent on their energy bills. Funding for instal-lations is provided by the National Bank of Arizona, which invested $25 million in the program. The city of Phoenix acts as facilitator between the bank, solar leasing company and homeowners, operating an easy-to-use website and toll free number for the program, arranging site inspec-tions and assessments and then signing up qualifying applicants. Solar Phoenix 2 works because it is a simple, one-stop-shop program that overcomes financial barriers and actively reaches out to the


public. The partnership is planning to enable 1000 new installations before the end of this year.

Building Solar Finance Literacy

The public is eager to embrace solar power, and believes that government can and should do more to promote a transi-tion to clean renewable energy sources. Polling data by Public Opinion Strategies and Fairbank, Maslin, Maullin, Metz & Associates from April 2012 indicates that a full two-thirds of Ohio voters believe that we should prioritize the use of re-newable energy over fossil fuels.38 This support is shared across demographic, partisan, and regional lines – in Cincin-nati 74 percent of voters support more solar energy.39 Ohioans also support

specific clean energy policies for solar – providing incentives to increase the use of small-scale solar projects at the sites of homes, businesses, and public buildings supported by 81% of the electorate.40

Given broad support education and outreach efforts can still help to overcome certain hurdles for solar. The public wants to go solar but individuals and busi-nesses are often unsure about the financial practicality of going solar themselves.41 Solar technologies are clean, proven and reliable, but financing mechanisms and available incentives can sometimes be difficult to navigate. Simplifying and streamlining options and communicat-ing that message effectively to a broader swathe of the Cincinnati community will take deliberate and strategic efforts. Edu-cated and informed citizens who under-stand the benefits, financing options, and installation procedures are empowered to make the decision to go solar.

Policy Highlight - Solar Leases and Power Purchase AgreementsThird party finance tools are attractive, proven models for overcoming fi-

nancial barriers to solar. The city of Cincinnati can take the lead by engaging with the private sector to offer residents new financing options and create a sustaining city-wide environment in which solar companies will thrive. The two dominant third party models are solar leases and power purchase agreements (PPA). In both models property and business owners looking to go solar can offer up rooftop or open space to solar power companies who will then install panels for free, instead of buying their own systems. The solar company retains ownership of the panel, and the rights to state and federal tax incentives and solar credits, while the homeowner receives power from the panels and pays a monthly leasing fee or agrees to purchase the power directly – usually this monthly payment results in net savings through reductions in the property’s energy bill. Most PPAs establish set rates and a predictable timetable for future increases – over a 20 year time frame or more – countering volatility in energy prices and providing a stable source of revenue for the solar company.


Best Practice in Action: Community Engagement in Portland, Oregon – Solarize Portland 42

Portland, OR, ran a Solarize Portland campaign from 2009 through 2011 which revolutionized the local solar market by overcoming financial and logistical barri-ers to solar power by allowing homeown-ers to buy into neighborhood collective purchase programs. Solarize began as a grassroots effort that evolved into a part-nership between the City of Portland Bu-reau of Planning and Sustainability, Solar Oregon and Energy Trust of Oregon. Solarize succeeded because it engaged residents eager for more solar power and simplified the process – empower-ing citizens to make the decision to go solar for themselves. Portland adopted a six-step process. First, a grassroots campaign advertized the program and generated local buzz and media atten-tion. Second, a series of workshops and Q&A sessions were offered throughout the community to address concerns and

educate the public. Third, a simple online enrollment process connected inter-ested homeowners to program managers. Fourth, site assessments were conducted by installation professionals. Fifth, quali-fying customers were invited to make a decision whether to participate or not after hearing the solar company’s offer. Sixth, contractors installed the system. As a result of Solarize Portland, the price of solar energy systems went down over 30 percent – through businesses learning by doing, ramping up scale, more easily finding customers and achieving efficien-cies – and over 50 permanent jobs were created for assessors, project managers, engineers, electricians, and roofers. Over three years of campaigns, Portland added over 1.7 MW of distributed PV and established a strong local economy for solar installation. Solar Portland linked residents to solar providers in an easy to use and understand fashion. By partner-ing with grassroots efforts and acting as mediator and educator, the city of Port-land was able to take the popularity of solar and empower its citizens to go solar.


Policy Recommendations

Cincinnati leaders have the opportu-nity to transform the Queen City into the Green City by embracing

a bold vision for a local solar economy. To face the challenges of the 21st century Cincinnati should adopt a bold but achievable goal of getting 10 percent of its energy from solar power by 2030. In order to achieve this vision, the key policies areas discussed above should be put in place to empower Cincinnatians to go solar.

The city’s Office of Environmental Quality has made great strides in lead-ing by example but Cincinnati can do more. In particular:

• The city should move forward with municipal installations by setting a goal of installing one Megawatt of

new capacity each year over the next decade.

• The city of Cincinnati should deepen its commitment by develop-ing and streamlining the financing process for municipal installations by standardizing Power Purchase Agreements and other third-party finance procedures as a guide for city and similar scale installations. The city can also lobby for virtual net-metering at the state level in order to open more municipal sites for solar.

• By getting more community anchor institutions to go solar, Cincinnati can demonstrate its broader commit-ments to solar energy. The city can actively promote and facilitate more solar installations in the “MUSH”

Policy Recommendations 19

market – municipalities, universities, schools and hospitals – by establish-ing a revolving low-interest loan fund for MUSH solar installations and setting up matching programs where the city leverages its solar commitments to encourage city insti-tutions to go solar.

The city can improve access to third party financing for Cincinnatians by:

• Partnering with local solar compa-nies and financial institutions to increase access to power purchase agreements and leasing options.

• Promoting standardized PPAs and solar leases to expedite and simplify the process for residential and commercial projects.

• Facilitating collective solar arrange-ments for many households and/or commercial properties to make PPAs and solar leases more attractive to banks and lenders.

To build solar finance literacy, the city of Cincinnati can partner with nonprofits, universities, high schools, utilities and solar companies to:

• Designate an official Solar Coordina-tor within the Office of Environmen-tal Quality to oversee solar programs

and ensure consistent delivery and accountability.

• Hold public workshops in Cincinnati about state and local solar financing options. In tandem with these educa-tion efforts, the city can partner with local non-profits to develop and distribute marketing materials about the reliability and track record of solar technologies locally.

• Simplify explanations of solar technologies and financing tools by creating an informational website or social marketing “one-stop-shop” solar site for Cincinnati with readily accessible local case studies, lists of common obstacles and solutions and FAQs about solar.

The city of Cincinnati can partner with green groups, solar businesses, and financial institutions to lead by example, get the finances of small-to-medium scale solar right, and build public literacy about financing options. Cincinnati can learn from other communities while building on its own experiences to craft a suite of local policies to go solar.


Notes 1. Cincinnati Zoo & Botanical Garden,

“Cincinnati Zoo Announces Advanced En-ergy Project,” 19 January 2010, available at http://www.melinkcorp.com/News-Events/Solar_Canopy_Announcement.pdf

2. Tony Dutzik and Rob Kerth, Frontier Group, Rob Sargent, Environment America Research & Policy Center, and Bernadette Del Chiaro, Environment California Re-search & Policy Center, Building a Solar Future: Repowering America’s Homes, Businesses and Industry with Solar Energy, March 2010, available at http://www.environmentamerica.org/sites/environment/files/reports/Build-ing-a-Solar-Future_0.pdf

3. U.S. Bureau of Labor Statistics, Consum-er Expenditure Survey, 2007: Table 2. Income Before Taxes: Average Annual Expenditures and Characteristics, 28 November 2008.

4. Department of Energy, Energy Infor-mation Administration, State Electricity Profiles 2011: Ohio, November 2012.

5. Jeff Deyette and Barbara Freese, Union of Concerned Scientists, Burning Coal, Burn-ing Cash: Ranking the States that Import the Most Coal, May 2010.

6. See note 4.

7. Ibid.

8. United States Department of Agricul-ture, USDA Economic Research Service, “U.S. Drought 2012: Farm and Food Im-pacts,” 9 November 2012, available at http://www.ers.usda.gov/topics/in-the-news/us-drought-2012-farm-and-food-impacts.aspx.

9. American Lung Association, State of the Air 2012, 2012, available at http://www.stateoftheair.org/2012/assets/state-of-the-air2012.pdf

10. US Environmental Protection Agency, Health: Nitrogen Dioxide, 28 October 2010, downloaded from www.epa.gov/oaqps001/nitrogenoxides/health.html

11. Ibid.

12. See note 9.

13. Shelley Vinyard and Lauren Randall, Environment America Research & Policy Center, Dirty Energy’s Assault On Our Health: Mercury, January 2011.

14. Ibid.

15. Travis Madsen, Frontier Group, and Lauren Randall, Environment Ohio Research & Policy Center, Ohio’s Biggest Mercury Pollut-ers: How Cleaning Up Power Plants in the State and Across the Nation Will Protect Our Health, November 2011.

16. Tony Dutzik and Elizabeth Ridlington, Frontier Group, and John Rumpler, Environ-ment America Research & Policy Center, The Costs of Fracking: The Price Tag of Dirty Drilling’s Environmental Damage, Fall 2012, available at http://www.frontiergroup.org/sites/default/files/reports/The%20Costs%20of%20Fracking%20vUS.pdf.

17. Tony Dutzik & Rob Kerth, Frontier Group, and Rob Sargent, Environment America Research & Policy Center, Smart, Clean and Ready to Go: How Solar Hot Water Can Reduce Pollution and Dependence on Fossil Fuels, March 2011, available at http://www.pennenvironment.org/sites/environment/files/reports/Smart-Clean-and-Ready-to-Go_.pdf

18. Mark Muro and Jonathan Rothwell, The Brookings Institute, and Devashree Saha, Battelle Technology Partnership Prac-tice, Sizing the Clean Economy: A National and

Notes 21

Regional Green Jobs Assessment, 2011, available at http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&ved=0CDYQFjAB&url=http%3A%2F%2Fwww.brookings.edu%2F~%2Fmedia%2FSeries%2Fresources%2F0713_clean_economy.pdf&ei=k32iUKqaC6rXyAH1p4GgAQ&usg=AFQjCNEI_JYcN0a-RYba40xheaHgYYi6PQ

19. Krister Aanesen, Stefan Heck and Dick-on Pinner, McKinsey&Company, McKinsey on Sustainability & Resource Productivity, Solar power: Darkest before dawn, May 2012, available at http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&ved=0CDAQFjAA&url=http%3A%2F%2Fwww.mckinsey.com%2Fclient_service%2Fsustainability%2Flatest_thinking%2F~%2Fmedia%2F5E847C563A734F148B5F3A6EFBD46E39.ashx&ei=IX6iUM_SFeTWyQHdk4DwCg&usg=AFQjCNFoEQxvEhi4r_qPuYmu8qa8jqxFuw

20. J. Paidipati, L. et al., Navigant Consult-ing, for the National Renewable Energy Labo-ratory, Rooftop Photovoltaics: Market Penetration Scenarios, February 2008.

21. See note 2.

22. Vasilis M. Fthenakis, Hyung Chul Kim and Erik Alsema, “Emissions from Photovol-taic Life Cycles,” Environmental Science and Technology, 42(6): 2168-2174, 2008.

23. U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, PV FAQs: What Is the Energy Payback for PV?, January 2004.

24. See note 17.

25. U.S. Department of Energy, Data-base of State Incentives for Renewables & Efficiency: Ohio, available at http://www.dsireusa.org/incentives/index.cfm?re=0&ee=0&spv=0&st=0&srp=1&state=OH, accessed 26 November 2012

26. Ibid.

27. City of Cincinnati, Office of Envi-ronmental Quality, Climate Protection Action Plan: The Green Cincinnati Plan, 19 June 2008.

28. See note 1.

29. “Macy’s one of the top solar power users in the U.S.,” Business Courier, 13 Sep-tember 2012, available at http://www.biz-journals.com/cincinnati/news/2012/09/13/macys-one-of-the-top-solar-power.html.

30. John Downey, “Fifth Third unit focuses on renewable energy,” Charlotte Business Journal, 17 August 2012, available at http://www.bizjournals.com/charlotte/blog/morning-edition/2012/08/fifth-third-unit-focuses-on-renewable.html.

31. Hannah McCartney, “Cincinnati Chooses Green Energy Aggregation: Deci-sion makes Cincinnati first major U.S. city to offer 100 percent green electricity,” CityBeat, 26 April 2012, available at http://www.city-beat.com/cincinnati/blog-3366-cincinnati_chooses_green_energy_aggregation.html.

32. U.S. Department of Energy, Solar America Cities, Solar in Action: Challenges and Successes on the Path toward a Solar-Powered Community: Ann Arbor, Michigan, October 2011.

33. Dave Metz, FM3, and Lori Weigel, Public Opinion Strategies, for RE-AMP, Voter Attitudes Towards Energy Issues in Ohio: A Summary of Pertinent Research Findings for Viewing by Candidates and Communications State for Candidates/Caucuses, 12 April 2012, available at http://www.theoec.org/PDFs/Energy/Voter_EnergyIssues_4-12-12.pdf.

34. Alameda County, CA, Alameda County Sustainability, “Solar Energy”, ac-cessed on 13 November 2012, available at


http://www.acgov.org/sustain/what/energy/solar.htm

35. PowerLight: Solar Electric Systems, Case Study: County of Alameda, California, 2005, downloaded on 13 November 2012, accessible at http://www.acgov.org/sustain/documents/solarcasestudy.pdf

36. Alan Goodrich, Ted James and Mi-chael Woodhouse, National Renewable Energy Laboratory, Residential, Commercial, and Utility-Scale Photovoltaic (PV) System Prices in the United States: Current Drivers and Cost-Reduction Opportunities, February 2012, available at http://www.nrel.gov/docs/fy12osti/53347.pdf

37. City of Phoenix Press Conference, Solar Phoenix 2, Residential Solar Financing, 18 May 2012, available at https://www.youtube.com/watch?v=1OFRwU-iSwc.

38. See note 29.

39. Ibid.

40. Ibid.

41. Hart Research Associates, for Solar Energy Industries Association, Results From National Survey, 27 September 2012, avail-able at http://www.slideshare.net/SEIA/seia-2012nationalsolarpollmemo.

42. Linda Irvine, Alexandra Sawyer and Jennifer Grove, Northwest Sustainable Energy for Economic Development, for U.S. Department of Energy, DOE SunShot Initiative, The Solarize Guidebook: A commu-nity guide to collective purchasing of residential PV systems, May 2012, available at http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&ved=0CDAQFjAA&url=http%3A%2F%2Fwww.nrel.gov%2Fdocs%2Ffy12osti%2F54738.pdf&ei=HYaiUJ3rK6XDygHk6oCQDA&usg=AFQjCNFk8VkRGuCw6hBprfq_S8GLzzUWJg.

Date post:	04-Jun-2020
Category:	Documents
Upload:	others
View:	0 times
Download:	0 times

Building a Solar Cincinnati - environmentohiocenter.org · Building a Solar Cincinnati The authors...

Documents