why big solar

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Page 1 of 3Why Big Solar is not Better Solar | Sol Systems Blog

6/6/2011http://www.solsystemscompany.com/blog/2011/02/04/why-big-solar-is-not-better-solar/


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Why Big Solar is not Better Solar

As solar energy systems become a more popular and profitable investment, many small and large scaleprojects are being developed. The idea of large solar projects may be attractive because of costadvantages due to scale, yet while the technology behind big and small solar projects is similar, some ofthe characteristics of big solar cancel out the advantages that are unique to solar energy.

Lets define big solar as a photovoltaic (PV) system or a concentrated solar power (CSP) system thatfeeds energy into the grid as opposed to small solar which feeds the direct energy load of a givenfacility (most commercial facilities require less than 1 MW of power).

First, big solar is inefficient in terms of its land use. Instead of using the millions of acres of rooftopspace and small vacant lots across the country, big solar is often built in deserts or remote areas, whichcould be potential agricultural or construction space, or even wildlife habitat.

Second, big solar requires significant transmission upgrades. Since large solar projects are far away fromwhere electricity is used, long and costly transmission lines must be constructed to connect big solarprojects with the grid. It costs approximately $1.5 million per mile for new transmission lines, asubstantial cost that removes a lot of the economic advantages associated with large scale projects. Bigsolar projects will require the U.S. to engage in even more costly infrastructure upgrades over the nextfew decades; whereas small solar projects actually reduce the need for costly infrastructure upgrades.

Third, big solar does not alleviate grid-congestion. Even if new transmission lines can be financed, theelectricity will only add to an already congested transmission and distribution system. Whereas, if smallscale solar power is added near the power demand (such as the rooftop of a house or building), then itwould not add at all to the congestion of the electrical system (one of the main causes of the 2003blackout in the Northeast). Grid congestion is becoming even more important as U.S. electrical demandis increasing at a much higher rate than U.S. transmission capacity.

Fourth, big solar wastes a significant amount of energy during transmission. Transmission from acentralized power plant to a user wastes electricity: according to the EIA, line losses accounted for 6.5%of total electricity generation in 2007. Small solar, typically constructed on the roof or within a mileof the building it powers, has virtually no energy loss due to transmission.

Fifth, big solar has the same security disadvantages of large centralized power plants. In other words,large scale solar is just as susceptible as other power plants to national security threats from hackers orterrorist groups.

Now that solar technology is becoming more affordable on a residential and commercial scale, there isthe potential to dramatically increase the prevalence of distributed generation power systems. Achieving

this would insulate the U.S. against its current dependence on large scale power plants and an outdatedelectrical grids transmission ability. Yet, despite the relative disadvantages of large solar power plants,big solar and small solar often compete for solar incentives such as SRECs (Solar Renewable EnergyCredits).

An SREC is a tradable credit that represents the clean energy benefits of electricity generated from asolar electric system. Each time the electric system generates 1000 kWh, a SREC is issued that can besold or traded separately from the power. SRECs have value because utilities and energy suppliers canpurchase them from system owners in order to meet the requirements determined in a states RenewablePortfolio Standard. Residential and commercial solar system owners can harness this value to offset the


6/6/2011http://www.solsystemscompany.com/blog/2011/02/04/why-big-solar-is-not-better-solar/


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costs of their solar energy systems. In some states, big solar threatens to reduce the value of theseincentives by flooding the SREC market and decreasing the price of SRECs.

When creating and adjusting renewable energy policies, legislators and policy makers should recognizethe unique benefits of small solar and distributed generation. It is important to understand that eventhough big solar may have some cost advantages, it is not the best solar.

Tags: Affordable solar, big solar, RPS legislation, Solar finance, SRECs

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6/6/2011http://www solsystemscompany com/blog/2011/02/04/why-big-solar-is-not-better-solar/

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