Factors Impacting Solar Panel Installations

Factors Impacting Solar Panel Installations

Factors Impacting Solar Panel Installations
For corporations, the solar installation depends on factors other than rates and rebates. In the United States, rules vary from state to state regarding how to attach solar plants to the electric grid and how to compensate producers for electricity they export to the grid. There is a general rule of thumb that solar energy must generate less than 50 percent of the building鈥檚 minimum electricity demand and this way the solar modules never come close to producing more electricity than the consumption needed for the building. Some utilities companies have been reluctant to open their grids to ever-larger quantities of the electricity that they cannot manage due to grid reliability and frequency or voltage disturbances. Some companies plan solar installation for 100 MW or up, but the slow response from the utility companies force them to scale down the project, which essentially restricts the growth of solar installation capacity. Electricity charges per kilowatt hour can block the expansion of solar installations. When the electricity prices are among the highest in the country, for example, 15 cents per kilowatt hour for the commercial sector, compared with a national average cost of, for example, 9 cents per kilowatt hour, companies will not go for the solar energy sources due to high cost of solar installation systems. Furthermore, project developers are not prepared to invest in solar installations until they are confident the utility company will agree to connect them hassle-free or without re-conditions. All these problems must be faced by the solar project developers before making a firm decision whether to go forward or not. Only a few states in the United States have adopted uniform interconnection standards for distributed solar power sources. Most of the utility companies have established their own interconnection requirements, which can be in conflict with those defined by individual
states. In addition, some states have adopted the IEEE standards and guidelines defined by the National Renewal Energy distributed with emphasis on reliability and safety. Environmental conditions will greatly improve with rapid acceptance of photovoltaic installations. It is interesting to mention that Oregon set a policy in June 2007 that can amount to a 50 percent tax credit for solar installations and manufacturing to encourage the full use of statewide solar energy. Such moves can significantly bring down the prices of solar modules and installation costs. Solar energy experts predict that solar panel prices will see significant reduction as soon as the new manufacturing capacity comes online starting in 2008.