Report: Concentrating Solar and Decentralized Power – Government Incentives Hinder Local Ownership

Date: 28 May 2008 | posted in: Energy | 0 Facebooktwitterredditmail

NOTE OCTOBER 2008:Since this press release was issued, Congress not only extended the Investment Tax Credit for eight years, but also lifted the cap on residential solar installations.

Large, remote concentrating solar power systems are the new darlings of the solar industry.  Some observers now see centralized, not decentralized solar as the future.  But a new report by the Institute for Local Self-Reliance reveals that the economic advantage of centralized solar and absentee owned solar arrays rests on federal tax incentives that discriminate against locally owned, decentralized solar arrays.

John Farrell, the report’s author and a strong voice in the energy community, calls for Congress to change federal tax incentives to give equal benefits to residential solar arrays, instead of favoring commercial and centralized projects.

“Decentralized solar arrays avoid the cost and hassle of building new high voltage transmission lines”, says Farrell.  “They also enable local ownership, which should be a goal of public policy.”

Concentratingsolar power plants work more like conventional power plants than solar photovoltaic panels.  They use large arrays of mirrors to focus sunlight for heat, using the heat to create steam and generate electricity.  These plants, mostly built in the deserts of the American Southwest, must send their power over long-distance transmission lines and are much larger than the rooftop solar panels that were previously the dominant form of solar power production.

The size of concentrating solar plants precludes local ownership, a benefit that renewable energy policy must factor in.  “Ownership converts citizens into energy producers, which in turn gives them a personal stake in expanding the use of renewable energy,” notes Farrell.  “It also encourages them to maximize energy efficiency, because the greater the efficiency the more independent they become, perhaps even becoming a net exporter of electricity.”

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John Farrell

John Farrell directs the Energy Democracy initiative at the Institute for Local Self-Reliance and he develops tools that allow communities to take charge of their energy future, and pursue the maximum economic benefits of the transition to 100% renewable power.