California Mandates Solar for Nearly All New Homes

In a historic move, California has become the first state in the country to require solar panels on nearly all new homes.

On May 9, 2018, the California Energy Commission (CEC) unanimously approved standards that, among other things, mandate the installation of solar energy systems on all new residences and major home renovations on buildings under three stories, starting on January 1, 2020. In the event the building is not suitable for a rooftop solar array, the standards require that the homes have access to community solar or offset energy usage through additional efficiency gains, while some homes may be exempt entirely.

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IRS Releases 2018 PTC Amounts

The IRS just published its annual notice that provides the inflation adjustment factors and reference prices used in determining the amount of the section 45 production tax credit (PTC) for the production of renewable energy and refined coal.

The credit for the production of renewable energy from wind, closed-loop biomass and geothermal facilities remains at 2.4 cents per kilowatt hour for 2018. The credit for the production of renewable energy from open-loop biomass, small irrigation power, landfill gas, trash, qualified hydropower, and marine and hydrokinetic facilities remains at 1.2 cents per kilowatt hour. The credit for the production of refined coal is $7.03 per ton for 2018 (up from $6.909 in 2017). No phase-outs apply to the credits for these energy resources in 2018.

A copy of the notice is available here.

Illinois Approves Long-Term Renewable Plan

On April 3, 2018, the Illinois Commerce Commission (ICC) approved, with modifications recommended by solar advocates and consumer groups, the Illinois Power Agency’s (IPA) Long-Term Renewable Resources Procurement Plan (Plan). The Plan was adopted under the Future Energy Jobs Act, which requires the ICC to establish a long-term plan for renewable resources procurement and lays out a path for electric utilities to get 25% of their power from renewable resources by 2025.

The Plan sets forth how the IPA, which procures energy for the state’s investor-owned utilities, will implement and oversee a variety of programs and procurements to purchase renewable energy credits (RECs). The utilities had argued that municipal utility and cooperative customers should not be able to sell RECs from their solar projects, since they do not pay into the state’s renewable energy fund that finances the RECs. An administrative law judge previously proposed an order that banned municipal and rural electric cooperative customers from the REC program.

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Trump Administration Imposes Tariffs on Steel and Aluminum

The international trade front has had some important developments over the last few weeks that will likely have significant impacts on the construction of domestic wind, solar, biomass and other types of renewable energy projects. One major development was the announcement of the section 232 steel and aluminum tariffs, where President Trump has informally announced the adoption of the harshest of the remedies recommended by the Department of Commerce – universal tariffs against all products from all companies. As detailed below, the political and business reaction to these tariffs was swift and generally negative (with the not-surprising exception of the aluminum and steel companies and the unions at their plants). Unsurprisingly, these new tariffs will have an impact on the costs associated with any component made with steel or aluminum, such as turbines, racks and tracking systems, and numerous other items, due to the increase in price of steel and aluminum sold in the US.

The details related to the 232 steel and aluminum tariffs are as follows:

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FERC Votes to Encourage Electric Storage

On February 15, 2018, the Federal Energy Regulatory Commission (FERC) voted to require all Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs) to revise its tariffs to establish a participation model for electric storage resources that consist of market rules that properly recognize the physical and operational characteristics of electric storage resources.

FERC’s goal is to remove barriers applicable to electric storage resources in the capacity, energy and ancillary services markets operated by RTOs and ISOs.

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