Utility Commission Ruling to Continue Growth of North Carolina Solar Industry in 2015

solar-cells-491701_640North Carolina’s ranking of #3 in the country for solar energy investment is receiving national attention and prompting some states in the Southeast to ask, "What is North Carolina's secret?"

The answer: clean energy policies that give solar companies the business certainty they need to make investments.

The North Carolina Utilities Commission did just that in an important ruling last week that keeps standard solar electricity purchase agreements in place. These contracts between utilities and solar developers typically last 15 years and cover solar projects up to five megawatts. They can make all the difference in whether a solar project is built and in a solar developer’s ability to grow and hire new workers.

Duke Energy and other North Carolina utilities sought to weaken the terms of these standard agreements, which are set by the Utilities Commission. The utilities asked the Commission to abandon requirements that they enter into long-term agreements with solar developers and sought to eliminate the ability of larger solar projects to participate.

After a careful and thorough review, the Utilities Commission disagreed with the utilities' arguments. Such actions would raise the costs of financing solar projects, significantly decrease the flow of capital into North Carolina, and jeopardize the growing solar industry at a time when the state needs good jobs in both rural and urban areas.

According to the NC Sustainable Energy Association, the state’s solar industry includes over 240 companies and employs thousands of North Carolinians.

The Utilities Commission’s ruling also affirmed Environmental Defense Fund’s recommendation that future payments to solar developers should include a comprehensive look at the benefits and costs of incorporating solar onto the electric grid.

This analysis will provide solar developers with payments that more accurately reflect the full range of benefits that the industry provides to North Carolina. One example is that solar energy can provide electricity to the grid and keep the power flowing during manmade or natural disasters. Solar energy also can save ratepayers money by avoiding the need to build new transmission and distribution lines.

In the 2015 legislative session beginning this month, North Carolina lawmakers should follow the Utilities Commission’s lead in maintaining a business-friendly climate for clean energy companies.

Legislators can do this by recognizing the importance of two policies that helped earn the state's high solar ranking:

  • The North Carolina Renewable Energy Portfolio Standard that increases the mix of clean energy and energy efficiency resources to 12.5 percent by 2021.
  • The North Carolina Renewable Energy Investment Tax Credit that makes clean energy investments more cost effective for businesses and families.

Keeping the renewable energy standard and the investment tax credit in place should be two of the legislature's top 10 resolutions for the new year.

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