Ithaca College said it would add 2.9 megawatts per hour of solar to power roughly 10 percent of its energy needs. The project is getting financed through a 25-year power-purchase agreement whereby the college has its costs fixed — a move that will offset 888 metric tons of carbon dioxide equivalents a year.
It’s all part of New York State requirement to increase its renewable energy generation. And it’s all tied to a broader aim — to invest in green energies and to bring down the rate of carbon emissions. Such investments not only create new jobs but they also work to create economies of scale, making the technologies cheaper and better for the next generation.
In the case of Ithaca College, its cost-savings benefit is realized through remote net metering, which was enacted in 2014 and allows for entities to install solar at an off-site location and receive credits for the energy fed onto the grid. Construction began in December and is expected to be completed by summer. It’s a dual project between Borrego Solar Systems and OneEnergy Renewables, financed by Greenwood Energy.
“This solar power purchase agreement will reduce the college’s greenhouse gas emissions by three percent compared to the baseline year of 2007, completing one of the objectives listed in the Climate Action Plan,” says Gerald Hector, vice president for finance and administration at Ithaca College.
It’s all part of the college’s strategy to become carbon neutral — a quest on which it set out in 2009. The goal is to get there by 2050.
The extension of the wind and solar tax credits in January will help them get there. Projects started before year’s end will qualify for a 2.3 cents per kilowatt hour production tax credit that will gradually diminish through 2019. Wind and solar projects could choose instead to take a 30 percent investment tax credit that reduces their federal taxes dollar-for-dollar by what they put into the deal. The main difference is that the solar production tax credit won’t go away until 2022.
Beyond that, there’s also the pending Clean Power Plan, which will now be heard by the DC Court of Appeals in June, which will likely grant the Obama administration’s wishes to proceed: it would require a 32 percent cut in carbon emissions by 2032 by requiring such things as more wind, solar and hydro.
And it’s not just colleges and universities that are moving ahead, it’s also industrial facilities as well as Internet and high-tech giants. Google, for example, has hundreds of thousands of servers that are huge consumers of electricity. To ease its reliance on fossil fuels, it is investing $1 billion in hard assets and owning a piece of the renewable projects. Google is also buying up renewable energy credits that give the wind and solar developers a certain income — including those sold by MidAmerican to finance its wind operations.
Intel Corp., Microsoft Corp. and SAP have even more investments in green energy, all of which will be accelerated with the extended tax credits and the Clean Power Plan.
“On the solar side, the ramp down (in tax credits) is an acknowledgement that solar is becoming economically competitive with other fuel options,” says Ray Hudson, director for DNV GL’s solar segment. The cost of solar panels is dropping precipitously, he adds in a phone call, noting that the theory is that they fall 20 percent for every doubling of capacity.
The domestic solar industry installed 7,286 megawatts of new rooftop solar generation, which is a record, according to joint research by the Solar Energy Industries Association and GTM Research released last week. Altogether the solar photovoltaic rooftop market has grown from 2,000 megawatts in 2010 to 25,000 megawatts in 2015.
Meantime, the utility scale solar market that links into the grid also grew: the firm reports that it was 4,000 megawatts in 2015, which represents a 6 percent increase from 2014. Those projects are almost always paid for with power-purchase agreements whereby utilities have contracted to buy the output at a fixed price over a set number of years.
“The U.S. solar market remains concentrated in key states, with the top 10 states accounting for 87 percent of installed capacity in 2015,” said Shayle Kann, senior vice president of GTM Research, in a release. “But growth has been widespread, and 24 of the 35 states that we track saw market growth in 2015.”
Ithaca College is an example of facilities shooting for the sun and New York State is an example of a state working to usher in those aims. And it’s all part of a movement to get greener and cleaner, facilitated by federal tax and environmental policies.