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 Arizona Solar Business Opportunity

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Arizona: A Golden Business
Opportunity for Solar Power

It is impertative for our nation that Obama keeps his word and delivers federal funds to develop a national feed-in tariff subsidy, decouple utility companies renewable energy programs from guaranteed rate of return terms, continue indefinitely investment tax credits and production tax credits and guarantee solar purchase volumes from manufacturers in order to immediately drop the prices on solar panels to make them cost-effective for both residential and business customers.

The Phoenix of Arizona's Rising Solar Energy Industry

The purpose of this page is to educate reporters, research firms, financial analysts, venture capitalists, real estate moguls and solar manufacturers on how vast the supply of Arizona solar energy is. This bountiful natural resource pours down a motherload of pure clean, carbon-free energy on Arizona more than 320 days per year. (Click here to attend a "Building a Solar Industry in Arizona" seminar)

Not only is Arizona blessed with lots of sunshine, but we are also lucky enough to have people like Congresswoman Gabrielle Giffords, Arizona Corporation Chairman Kris Mayes, Mayor Gordon (Phoenix) and Mayor Walkup (Tucson), Economic Developer Barry Broome and the many other solar experts mentioned on this page that have been working overtime to make the solar industry a reality in Arizona.

This effort includes the executives permitting the land, driving the steel into the ground, stringing the transmission lines, developing the solar power regulations, driving solar business deals, building concentrated solar plants, installing solar PV on residential and commercial structures and striving for serious economic development and job creation in Arizona.

Arizona is building a network of solar power systems that will rival the telecommunications infrastructure built during the '90s. In a similar manner to the Internet's ability to carry billions of data packets around the world, Arizona's solar energy collector and transmission network will deliver 10,000 megawatts of clean, carbon free energy to Arizona and the rest of the United States.

To make this possible Arizona carefully lined up the stars of solar energy industry and made it as quick as possible to build out a solar power transmission network. And, unlike California which has many unfinished projects, Arizona is making it happen in a matter of months for projects such as the Solana plant in Gila Bend, AZ.

This is just one of the reasons why Arizona is now home to an increasing number of solar manufacturing plants and has caught the attention of many financial analysts, venture capitalists and private equity investors that see the real value in building out a massive solar collector network to capture Arizona's golden treasury of radiation and export it to the rest of the United States on a profitable basis.

The easiest and most cost effective way to farm the sunshine in Arizona is to build utility-grade concentrated solar power (CSP) plants like this one to soak up the sunshine, and then use high-density transmission lines to export it to other states that need more electricity.

Many experts and industry research reports detailed on this page indicate that there is enough solar energy in Arizona and other southwestern states to power the entire United States. All we need to do to farm this goldmine of green energy is to build utility-grade concentrated solar power (CSP) plants to soak up the sunshine, and then use high-density transmission lines to export it to other states that need more electricity.

In addition to building utility grade solar energy power plants, there are millions of large commercial and residential roof tops available that could be used to collect solar power right now. Known as distributed generation, smaller solar power plants can use Arizona's superior net metering system to reduce electricity bills by allowing customers to generate their own electricity and sell any left over juice back to APS, SRP, and TEP to help them manage their peak load demand.

The quickest way to harness the sunshine is Arizona is to add solar panels to the millions of large commercial and residential roof tops available that could be used to collect solar power.  Known as distributed generation, smaller solar power plants can use Arizona's net metering system to reduce electricity bills by allowing customers to generate their own electricity and sell any left over juice back to APS, SRP, and TEP to help them manage their peak load demand.

Next to every big commercial structure with a large roof there is also a large parking lot with even more room to deploy solar panels. Parking lot solar plants provide a dual benefit of producing clean energy as well as providing highly sought after shade from the sun's strong rays during Arizona's scorching summers.

Adding solar energy power plants to Arizona parking lots would provide a dual benefit of producing clean energy as well as providing highly sought after shade from the sun's strong rays during Arizona's scorching summers.

The abundance of sunshine and the energy it can generate has made Arizona a focal point of political campaigns and economic discussions in Washington, DC. During the 2008 presidential race, a lot of emphasis was placed on Obama's campaign promise to spend $150 billion to build a new renewable energy industry and create more than 5 million jobs.

The election is over and Obama's administration has made good on their word by funding the construction and operation of a large scale network of renewable energy power plants, which will be a guaranteed way to free our nation from its dependency on foreign oil.

During the presidential election campaign numerous press articles focused on the amount of money that would be spent and the number of jobs it would create. What the media has not focused on to date is where the best places in America are located to build utility grade solar energy power plants and large scale wind farms.

We may be biased because we live in Arizona, but taking a quick look at the solar insolation map below, it is obvious that Arizona and New Mexico are by far the best places begin spending money in order to harness the treasure trove of solar energy that warms our deserts every day.

Arizona: The Persian Gulf of Solar Power in America

They say a picture is worth a million words. We decided to start by showing you a solar insolation map during the winter, when most states are covered by clouds. Arizona gets 321 days of sunshine a year.
Arizona Produces Solar 123,500 MWh PV Per Year

As you can see, Arizona offers a very large vein of solar energy that can be used to power utility grade solar energy power plants, which will attract billions of dollars in investment capital, provide a boom to Arizona's economic development, and generate thousands and thousands of construction and permanent jobs.

Based on the amount of natural sunshine and wind, Arizona is firmly positioned as one of the top providers of carbon-free energy.

Top States Ranked by Solar Energy Insolation

  1. Arizona
  2. New Mexico
  3. Nevada
  4. California
  5. Texas
  6. Utah
  7. Colorado
  8. Wyoming
  9. Florida
  10. Kansas

The good news is that Obama is very serious about this issue and plans on taking the appropriate action to get our nation back on track.

Obama signed the American Recovery and Reinvestment Act of 2009 into law and has budgeted to spend $41 billion, including:

  • $11 billion funding for an electric smart grid
  • $6.3 billion for state and local governments to make investments in energy efficiency
  • $6 billion for renewable energy power generation loans
  • $5 billion for weatherizing modest-income homes
  • $4.5 billion for state and local governments to increase energy efficiency in federal buildings
  • $3.4 billion for carbon capture experiments
  • $2.5 billion for energy efficiency research
  • $2 billion for car battery research
  • $500 million for training of green-collar workers
  • $400 million for electric vehicle technologies
  • $300 million to buy energy efficient appliances
  • $300 million for reducing diesel fuel emissions
  • $300 million for state and local governments to purchase energy efficient vehicles $250 million to increase energy efficiency in low-income housing

The new Obama administration needs to consider carefully how to spend federal funds on important programs such as national cap-and-trade program to reduce carbon emissions, feed-in tariff subsidies, programs that decouple utilities' demand side management (DSM) and renewable energy programs from their guaranteed rate of return revenue, programs that continue important solar investment tax credits and solar production tax credits.

More important than money that we MIGHT receive is the Renewable Energy Standard (RES) mandated by the Arizona Corporation Commission. Per the RES, a minimum of $60,000,0000 per year until 2025 has to be spent on developing renewable energy power plants that generate clean, green power.

That budget adds up $1.2 billion of guaranteed money that will subsidize the installation of solar on residential and businesses.

Every home solar power system installation requires about ten people including sales staff to answer the phone, an engineer to do the site evaluation, a CAD engineer to draw up the solar power plant design, a permiting specialist to file permit paperwork with the city, a rebate specialist to file the paperwork to receive tax credits from the federal government, a manager to approved the design, two to three construction personnel to build it and one financial professional to arrange the financing to pay for the installation.

With a $60 million guaranteed budget from the RES, and a typical rebate issued by the utilities of $30,000, more than 2,000 residential installations per year could be built. Do the math and 2,000 jobs would require 20,000 people to make the installations happen. That is a lot of jobs, which would very beneficial for Arizona's ailing economy.

Large scale utility grade solar power plants are much larger and each would produce significantly more jobs than a residential installation.

The technology used to make solar panels is the same technology used to make semiconductor chips. In the last five years thousands of semiconductor engineers have been laid off. Creating this type of local demand for solar power panels is the single best way to attract solar manufacturing companies to set up shop in Arizona. Growing semiconductor silicon for computer chips or solar panels is a very similar process.

The Greater Phoenix Economic Council (GPEC) is working overtime to lobby the Arizona legislature to pass transferrable corporate tax credit packages for manufacturers and companies that move their corporate headquarters to Arizona. Another proposal includes passing a real and personal property tax reduction for companies that make capital investments of more than $25 million in Arizona.

It is vital that Arizona invests all of its time and energy to jump start the economy by frugally spending the yearly $60 million RES budget to stimulate the demand for billions and billions of dollars that would flow into this state to build solar electric power plants and recruit international solar manufacturers to build new solar factories in Arizona.

As with any business, volume buying by the masses will create sufficient demand to drive down prices and make solar technology available for every household and business in Arizona.

Below you will find links to an immense library of solar information retrieved from Arizona's leading solar economic development teams, solar energy research consulting firms, solar manufacturers, solar installation teams, solar business development specialists, solar commercial real estate developers and solar property management companies.

We built this repository of information so that everyone in the solar industry will have a place to research solar energy facts and figures and use them to create and disseminate marketing messages to educate the world on the endless supply of solar energy that is falling on Arizona's golden deserts every day.

Building momentum in the national media is the best way for Washington and the Obama administration to recognize that Arizona is the best place to fulfill their promise of providing quick economic relief via a 10-year, $150 billion deal to create 5 million green collar jobs.

Arizona needs to work together as team to generate a large volume of news articles, which will highlight the sheer volume of roof space and empty parking lots that are ready and waiting to be developed into distributed solar power generation plants right where we need it most -- in the middle of the grid.

Regardless of what industry you work in, if your company is doing anything related to solar energy, we would like to help you generate some positive publicity for your efforts. We can generate publicity in any of the following business-to-business categories. Each industry link is attached to other companies that are successfully generating the type of news we would like to be generating for your company.

Persuasive media campaigns are the best way to raise awareness and reach decision makers in the following industries: shopping malls, movie theaters, sports arenas, convention centers, airports, warehouses, military bases, corporate campuses, retail supercenters such as Wal-mart, ranching/dairies, hospitals, manufacturing plants, hotels, churches, schools, apartment complexes and large parking lots.

 

What the National Media is Saying about Solar Energy:

11/29/08 - Washington Post - Nations Spend in Tandem To Stall Global Recession

11/28/08 - The Associated Press - Western governors: Obama, act quickly on energy

11/23/08 - Washington Post - Obama Sets Expansive Goal for Jobs

11/25/08 - Forbes Magazine - Solar Energy's Sunny Side

11/23/08 - Business Week -Will Demand for Solar Homes Pick Up?

11/14/08 - SEIA: Does America Need a Feed-in Tariff to Stimulate the Solar Industry?

11/17/08 - Wall Street Journal - Consumers as Producers

11/17/08 - Wall Street Journal - In Search of Lower Sales

11/16/08 - Arizona Republic - Initiatives could yield new jobs

10/21/08 - Bloomberg News - Betting on 'Cleantech' Billions

10/15/08 - Los Angeles Times - A solar bond for Los Angeles?

10/06/08 - Wall Street Journal - Lightening the Load

9/24/08 - New York Times - Amid Boom, Concerns at Small Solar Firms

9/24/08 - Arizona Republic - Solar industry clears hurdle with tax credit

8/14/08 - Arizona Republic - Solar energy: It's a win-win-win

8/10/08 - New York Times - Giant Retailers Look to Sun for Energy Savings

7/11/08 - Fortune Magazine - The Southwest desert's real estate boom

Arizona Solar Frequently Asked Questions Database

Have questions about solar energy, solar technology used to convert sunshine to electricity or a how to evaluate and find the right solar power system for your home or business? The links below will help you find the answers to all your questions.

Arizona Solar - Measuring Return on Investment

Installing a solar system is hard to justify from a pure money making objective. If you are looking for ways to save money on your electricity bills, installing solar is not the best idea.

Instead focus on replacing light bulbs with CFL light bulbs and upgrading all your appliances to the most energy effecient products you can afford. You should also unplug energy vampires like cell phone chargers when not in use because they use a lot of energy even when they are not charging anything.

However, if you can afford to invest $10,000 of your own money to pay for a system that will allow your household to reduce America's carbon footprint, buying and installing a solar energy PV system on your home is a very wise decision. The link below will automatically include all incentive programs available for your zip code. Try it!

Click Here to Measure Solar Return on Investment for Your Zip Code

Arizona Solar Energy PowerPoint Presentations Loaded with Photos, Graphs, Diagrams, Facts & Figures

Arizona Solar Power Subject Matter Experts

  • Mark Mehos - Mr. Mehos is the Program Manager for the Concentrating Solar Power Program at the National Renewable Energy Laboratory. Mr. Mehos will provide an overall assessment of the available resource size for solar energy in the U.S. and an introduction to the known technologies that may take advantage of solar power on a large scale. Mark can be reached at (303) 384-7458 or mark_mehos@nrel.gov.

  • Tom Hansen - Mr. Hansen is the Vice President of Environmental Services, Conservation and Renewable Energy at Tucson Electric Power. Mr. Hansen will describe a "Solar Grand Plan" to provide more than half of the U.S.'s electricity from solar power by 2050.

  • Kate Maracas - Ms. Maracas is the Vice President of Arizona operations at Abengoa Solar and is heading up the Solana Solar Power Plant in Arizona. Ms. Maracas will describe the current state of solar thermal technology and the near- and long-term economic costs and benefits of large-scale solar power in general.

  • Valerie Rauluk - Ms. Rauluk is the Founder and CEO of Venture Catalyst, Inc. Ms. Rauluk will describe the current state of distributed and concentrating photovoltaics and provide an assessment of how the marketplace for solar energy will change over the next 10 years.

  • Barbara Lockwood - Ms. Lockwood is the Manager of Solar Energy for Arizona Public Service. Ms. Lockwood will provide the perspective of utilities on the ability for large-scale solar power to be a significant competitor in the U.S. energy sector over the next 50 years.

  • Joe Kastner - Mr. Kastner is the Vice President of Implementation and Operations for MMA Renewable Ventures LLC. Mr. Kastner will describe his company's experience with installing and managing the Nellis Air Force Base solar array and ways to enable productive partnerships between government and renewable energy industries in general.

  • Toni Bouchard - Ms. Bouchard is the Renewable Energy Advisor for Arizona Public Service where she is responsible for stakeholder relations and external affairs related to APS's large utility-scale renewable energy projects such as the new Solana Generating Station. Solana is a 280 MW solar project announced in February 2008. In addition, Toni leads several strategic initiatives to support APS's commitment to renewable energy development. Toni can be reached at 602-250-2306 or antonia.bouchard@aps.com


  • Gabrielle Giffords - Congresswoman Giffords is the U.S. Representative for the Eighth District of Arizona, a diverse area that covers 9,000 square miles including a 114 mile border with Mexico. Giffords serves on the House Armed Services Committee, the House Foreign Affairs Committee, and the House Science and Technology Committee. Her work on the Subcommittee on Energy and the Environment included a Congressional Field Hearing in Tucson in March 2008 to hear testimony on utility scale solar energy. She promotes an agenda of energy independence and solar initiatives in an effort to make Southern Arizona the "Solar-con Valley" of the nation. Giffords can be reached by contacting Tamarack Little at email:tamarack.little@mail.house.gov or 520-881-3588.


  • Bruce Plenk - Mr. Plenk is the Solar Energy Coordinator for the City of Tucson. His family lived in a passive solar house for many years. He worked as a solar installer in Tucson. Before and after moving to Tucson, he worked on energy conservation and renewable energy issues on city advisory boards. His present position is funded through a Solar America Cities grant from the US Department of Energy. Plenk can be reached at 520-791-5111x327 or bruce.plenk@tucsonaz.gov.


  • Jeff Schlegel - Mr. Schlegal is an Energy Policy Consultant for Southwest Energy Efficiency Project (SWEEP) specializing in policy analysis, planning, evaluation, and program design for energy efficiency, renewable energy, and low income energy programs. Jeff has more than 25 years of experience in the energy field. In Arizona, Mr. Schlegel is working for the Southwest Energy Efficiency Project (SWEEP), a public interest organization promoting energy efficiency in six southwestern states. SWEEP supports clean and sustainable energy resources at the state legislature, before the Arizona Corporation Commission (utility regulators), in discussions with Arizona utilities and business leaders, and in global warming policy forums (including the Governor's Climate Change Advisory Group).Schlegel can be reached at 520-797-4392 or schlegelj@aol.com.


  • Robert E. Walkup - Mr. Walkup is the Mayor for the City of Tucson, AZ. Mayor Walkup was elected to his third term as Mayor of Tucson in 2007. During his tenure there have been numerous fundamental changes in the Tucson region's operations. Working together with Pima County, Mayor Walkup has engineered consolidations of economic development agencies into one regional entity, the Tucson Regional Economic Opportunities, Inc. (TREO). His efforts in economic development have contributed to a net increase of 50,000 jobs and $10,000 per year in average worker earnings during his tenure. Mayor Walkup is a member of Congresswoman Gabrielle Giffords' Solar Advisory Council. Walkup can be reached at 520-791-4201 or Email_Mayor@tucsonaz.gov.


  • Joseph H. Simmons - Mr. Simmons is the Department Head of Material Science & Engineering for the University of Arizona and is the Co-Director for Arizona Research Institute for Solar Energy. Simmons graduated with a BS in Physics (University of Maryland, 1962), an MS in Physics (John Carroll University, 1966) and a PhD in Condensed Matter Physics (Catholic University, 1969). His studies have spanned numerous topics in optical properties of materials, solar energy, condensed matter physics, spectroscopy, glass science and computational modeling. Simmons is the author of over 110 refereed journal articles, and 13 US patents. Simmons can be reached at 520-620-6071 or simmons@mse.arizona.edu.


  • Ardeth Barnhart - Ms. Barnhart serves as the associate director of the Arizona Research Institute for Solar Energy, evaluating solar energy programs worldwide and assessing economic and policy characteristics and conducting economic and technical analysis of the available and commercial methods for converting solar energy to heat and electricity. She joined the Institute in 2007, after working in the renewable energy and policy sector developing renewable energy development and policy plans for international implementation under the Kyoto Protocol and earning a master's degree in environmental science and policy from Columbia University. Barnhart can be reached at 520-275-1895 or ardethb@email.arizona.edu.


  • Tom Doyle - Mr. Doyle is senior vice president of project development for BrightSource Energy, which is a solar energy plant developer. Prior to joining BrightSource Energy, Mr. Doyle worked at InterGen where he held positions as Managing Director, Asia, with Profit & Loss responsibility for InterGen's Asia assets, General Manager of North America, responsible for a U.S. portfolio of over 3,500 MWs of merchant and contracted power, and as Vice President, Asia Pacific Development. He also worked with Foster Wheeler Energy Corporation and Tucson Electric Power Company in various management, sales and engineering positions. Mr. Doyle has over twenty years of energy industry experience, primarily in the project financed green-field development arena. He serves on the Board of Directors for Arizona Heart International, is a registered Professional Engineer and holds a Master's in Business Administration and a Bachelor of Science from the University of Arizona. Doyle can be reached by contacting Keely Wachs at kwachs@brightsourceenergy.com or 510-250-8153.

Arizona Solar Executive Quotes

William C. Harris, President & CEO, Science Foundation Arizona, said "Arizona is the solar capital of the United States. In fact, with the necessary technology, Arizona has enough sun to provide power for the entire country. We have the opportunity to lead the world in solar technology development in a span of five to 10 years and reap enormous benefits: environmental impacts, wealth generation resulting from commercialized technologies and economic implications for entire regions."

The Governor's Arizona Department of Commerce (ADOC) also commissioned the Arizona Solar Electric Roadmap Study, which was released in January 2007. The study proposed five key initiatives for jumpstarting solar growth in Arizona. As the study noted, "Arizona has the potential to become a world leader in many aspects of solar development, and is a model location for the evolution of new solar technologies and applications."

Arizona was one of the first states to pass standards for renewable energy, beginning with its Solar Portfolio Standard, which was the precursor to the EPS and the Renewable Energy Standard. "Our standard is the most aggressive in the country for the number of solar rooftops that it will spur," Kris Mayes, Arizona Corporation Commissioner said. "Arizona will have, on a per apita basis, more solar rooftops than any state in the country."

Solar energy is expected to comprise two-thirds of Arizona's renewable energy, which Mayes says will be able to power about 500,000 homes in 2025. "Solar energy is going to be the engine of Arizona's renewable energy future," Mayes said. "We knew that when we were developing the renewable energy standard."

Gabrielle Giffords, U.S. Congresswoman made these statements at the Utility Scale Solar Power Opportunities & Obstacles hearing for the Subcommittee of Energy and Environment:

"Solar power is a big idea, whose time has come. And, like the space program, solar is an idea that can shape our nation in significant and positive ways. In the coming months, in the coming years, we will face critical decisions on how to address climate change, reduce our dependence on foreign energy, and boost our economic competitiveness.

The beauty of solar power is that it offers an elegant solution to all three of these challenges. Imagine what it would be like if every time that it rained it rained oil, big black drops falling from the sky. Don't you think that we would find some way to run around with a big bucket and collect all of that energy that was falling from the sky? I know this sounds like an absurd picture, but the reality is that what we have outside today is something very comparable to that. Literally, we have useful energy pouring out of the sky, and nowhere does it rain sunshine with greater intensity and consistency than in the American southwest.

In fact, some studies show that there is enough sunshine in the southwest to power almost our entire nation. One of these studies was recently covered on - actually, was brought forward on the front cover of the "Scientific American Magazine." So, in other words, the southwest is home to a national treasure that streams from the sky almost every day."

Kate Maracas, Vice President Arizona Operations, Abengona Solar Inc. made these statements:

What does CSP or large-scale solar deployment really mean, in terms of just kind of generalization across the board, what does one gigawatt, 1,000 megawatts of CSP actually do to our economies?

Our findings were that for every one Gigawatt (GW) of CSP added to a state's economy, the deployment would yield:

  • $3-$4 billion private investment in the state of Arizona;
  • 3,400-5,000 construction jobs; up to 200 permanent solar plant jobs, many in rural areas;
  • $1.3-$1.9 billion 30-yr. increase in State tax revenues; and
  • $4-$5 billion increase in Gross State Product.

Those figures represent net effects, even after any tax credits or economic incentives are utilized to stimulate industry development. Clearly, the findings show that broader incorporation of large-scale solar plants into the U.S. generation fleet not only produces the benefits of sustainability and energy independence, it also pays back in very significant, positive economic impacts.

Barbara Lockwood, Manager of Renewable Energy for Arizona Public Service (APS) made these statements:

In Arizona, our most abundant renewable resource is sunshine. The solar resource in Arizona is virtually unlimited, with more than 300 days of sunshine each year. In addition, Arizona has sizable quantities of wide-open, flat landscape that is ideal for the installation of large-scale solar equipment. Among the most important factors in considering a resource for electricity production is the reliability of the fuel. Arizona's solar climate provides a resource that is both dependable and predictable. APS is committed to making Arizona the solar capital of the world and bringing affordable renewable energy to all its customers.

In 1988, the APS Solar Technology And Research (STAR) center was developed to support the advancement of solar resources, including field operation of both photovoltaic and concentrating solar technologies. In addition to STAR, APS currently has over five megawatts of photovoltaic power plants in operation providing reliable solar energy to our customers.

APS has also supported the advancement of concentrating solar power (CSP). These technologies are "thermal electric systems" that use solar heat to drive generators and engines. CSP thermal systems include solar trough concentrator systems and central receiver (power tower) systems that use many mirrors to focus light on a central solar collector. CSP also include solar dish Stirling systems and other advanced solar concepts.

In fact, APS constructed the first commercial CSP plant in the United States in almost 20 years. The Saguaro Solar Power Plant, which came on-line in 2006, is a one megawatt parabolic trough facility located just north of Tucson at Red Rock, Arizona. This plant has provided critical learning for APS, the CSP industry, and researchers. While small in size, it has facilitated new interest in CSP around the country and the world.

But that was just the beginning of our entrance into commercial CSP. Also in 2006, APS stepped forward to lead a coalition of southwestern utilities interested in CSP. The Joint Development Group is a consortium of seven entities exploring the possibility of a 250 megawatt CSP project to be located in Arizona or Nevada. Acting as project coordinator, APS issued a request for proposals in December of 2007. If all goes well, the consortium project could be selected this summer. But our most significant step to date is the announcement on February 21, 2008, of the Solana Generating Station. Solana is a 280 megawatt solar power plant to be located 70 miles southwest of Phoenix near Gila Bend, Arizona. APS has signed a long-term contract with Abengoa Solar, project developer and owner, for 100 percent of the electricity generated by Solana. Solana is the Spanish word for "sunny place."

If operating today, Solana would be the largest solar power plant in the world. The plant will use nearly three square miles of parabolic trough mirrors and receiver pipes, coupled with two 140-megawatt steam generators. Operating at full capacity, the plant will produce enough electricity to power 70,000 Arizona homes.

Solana also provides significant economic benefits to the State of Arizona. The Solana Generating Station will provide 1,500 construction jobs between 2008 and 2011 and 85 permanent operations jobs. Solana will also generate between $300 million and $400 million in tax revenue over the 30 year life of the plant. All total, Solana will result in over $1 billion in economic development for the Arizona economy. Finally, Solana is an emission-free source of electricity, avoiding nearly 500,000 tons of carbon dioxide, 1,065 tons of nitrogen oxides, and 520 tons of sulfur dioxide each year. It is the equivalent of removing 80,000 cars from the road each year. Solana will also use 75 percent less water than the current agricultural usage of the land.

One of the most important aspects of Solana is its ability to capture and store solar energy for later use. By incorporating large insulated tanks filled with molten salt, heat captured during the day can be stored and used to produce electricity when the sun is no longer shining. The molten salt and heavily insulated tanks are able to retain heat with very high efficiency, and the stored heat can then be extracted in the evening or even the following day to create electricity.

The stored heat not only increases the total amount of electricity generated, it also adds specific operating benefits for APS. The ability to use stored heat on demand, also referred to as "dispatching," allows APS to respond to customer usage patterns and emergency energy needs more effectively. Most southwest utilities experience their highest customer demand during the summer months. While the power need is substantial in the middle of the day, peak energy demand occurs in the late afternoon and into the early evening hours. Because it can provide energy even after the sun has set, the solar trough with thermal energy storage provides the maximum value for APS and its customers.

Diversification of generation resources is critical to maintaining a reliable electric system and concentrating solar power provides a significant opportunity to diversify energy resources. In addition, the costs to construct and maintain concentrating solar power plants have declined while at the same time equipment and labor costs, rising fuel prices and emissions concerns are increasing the risks of conventional resources. APS also recognizes that renewable energy strategies will become even more important under the prospects of carbon legislation. With zero carbon emissions, energy from solar power provides one method of addressing concerns around global warming while continuing to provide reliable electricity to our customers.

And Solana is not the end of our interest in CSP. APS is currently engaged in a formal dialogue with our regulators, stakeholders and customers about our future energy sources. We are exploring the availability, cost, regulatory and policy implications associated with many different types of resources including nuclear, natural gas, coal, energy efficiency and renewable energy. One of several scenarios under discussion is one where CSP plays a central role, adding 1,350 megawatts by 2020. Each of these efforts will help us to meet, and possibly exceed, the progressive Renewable Energy Standard established by the Arizona Corporation Commission.

In considering the long-term potential for utility scale solar, one topic of consideration is how to integrate large solar plants into the regional and national electric grid. This topic raises numerous issues including availability of land for large scale installation and the availability of transmission facilities and transmission capacity to deliver the energy to load centers. The lack of transmission capacity and how that is managed will be a significant factor in the long-term success of utility-scale solar. In fact, transmission is generally constrained in much of the west and significant new transmission investment is needed in the coming years for all types of generation be they renewable or conventional generation.

Also, the possibility of locating large scale solar on federal land should be investigated and analyzed. By its nature, solar technologies require significant geographic footprints. A general rule of thumb for a solar installation is five to 10 acres per megawatt. As I previously stated, the Solana Generating Station requires three square miles of contiguous land. Considering that the Federal Government is the largest land owner in the U.S., a study of federal land in high solar resource areas that may be made available for CSP development would also be beneficial and appropriate.

The biggest obstacle to the success of utility-scale solar, including Solana, is the potential expiration of the federal Investment Tax Credit (ITC). Solana, and projects like Solana, became possible when the federal ITC for solar systems was increased from 10 percent to 30 percent in 2006. While large-scale solar is still more expensive than conventional resources, the 30 percent investment tax credit decreased the cost sufficient to make these projects a reasonable option. Without these tax credits, large scale solar projects, including Solana, are simply not affordable today. As you know, the 30 percent ITC is scheduled to expire at the end of 2008. The approval, permitting and construction of the Solana Generating Station will take three to four years to complete. The Solana project also requires well over a billion in capital investment. APS, Abengoa Solar, and the financial institutions providing funding for Solana require certainty that Solana will be eligible for the ITC once operational. If a long-term extension of the ITC is not granted, Solana will not be completed.

Joseph Kastner is Vice President of Implementation and Operations for MMA Renewable Ventures LLC made these statements:

Utility-scale solar projects represent the greatest opportunity for solar electric generation technologies to reach cost parity with conventional gas and coal-fueled electric generation. When equipment, labor, and capital are deployed to build solar projects at a scale counted in tens of megawatts, gains from economies of scale including the spread of transaction costs can deliver lower cost solar power. Additionally, this will spur the cost efficiencies required to make the deployment of distributed generation more competitive with retail electricity rates requiring minimal subsidies.

In order to promote the development of projects of such scale, project developers and financial entities need to have a relatively stable financial, legal, and regulatory environment. All fuel-less electric generation technologies are more capital intensive than conventional combustion-based technologies, requiring long-term stability in the business environment to mobilize capital. The following concepts/initiatives are key to the development and financing of utility-scale solar:

1. Long-Term Federal Tax Incentives

The current 30 percent investment tax credit (ITC) for solar projects expires at the end of 2008. At present, these federal incentives are critical to the development and financing of utility-scale solar projects. Without the federal tax benefits, utility scale solar projects will not be viable because the cost of energy will simply be too high.

The effectiveness of existing incentives is significantly limited in driving development of utility scale projects with long lead time particularly given the pace of development and consumer adoption of energy technologies. The existing tax credits or incentives are short-term, piecemeal programs subject to the uncertainty of the Congressional reauthorization and/or appropriations processes. For example, the production tax credit for wind and other types of renewable energy, established in 1992, has been subject to three expirations and several short-term extensions (some retroactive). Uncertainty around the ITC extension increases the cost of capital due to the risk of meeting a deadline and leads to a boom and bust cycle which has caused the inflation of equipment costs purely from supply constraints.

Congress should pass a long-term ITC to drive substantial private sector investment in clean energy technologies. Investors need stable, long-term, and predictable incentives. MMA Renewable Ventures supports a minimum seven-year timeframe for clean energy tax credits because this is the minimum period necessary to enable rational investment decisions and deployment of resources in utility scale projects. The federal regulatory environment's support for energy technologies can be significantly improved by establishing consistency and predictability.

At the bottom line, those of us who are actually building and financing utility scale solar projects need greater certainty of the federal tax benefits. In addition, the ITC could benefit from the amendment of several rules within the IRS code:

  • Eliminate the basis adjustment so that one-half of ITC is not "recaptured";
  • Make renewable energy investments eligible for Community Reinvestment

Act (CRA) consideration. Structured correctly, this could serve to catalyze both distributed and utility-scale solar projects in low and moderate-income communities and/or serving public facilities. It would also serve to attract additional institutional investors into the space and help to create "green-collar" jobs in lower-income communities;

  • Create an "economic substance" carve-out for solar tax credits similar to what was done for low-income housing tax credits;
  • Raise the production tax credit (PTC) for solar to make it competitive with the ITC and give investors a choice of either one. The PTC structure is a better fit for some investors and will encourage more capital to enter the solar space;
  • Match the residual value exemption currently available to the low income housing sector, allowing for no constraints at resale after the tax benefits have been monetized;
  • Abolish the possibility for ITC recapture in the event of a catastrophic loss without replacement by the end of a calendar year;
  • Allow tax equity to enter project after the system as reached commercial operation under any financing structure.

2. A Stable Legal Framework

One of the important prerequisites for investors in utility-scale solar projects is certainty the commercial arrangements will remain intact for the full term of the financing. Utility purchasers, commissions, and State and federal regulations all need to provide certainty and assurances that the various commercial arrangements will not materially change throughout the life of the project.

For instance, in reviewing the standard contracts proposed for the Nellis AFB project it was determined that certain elements in the site lease and the streams of revenues from the power purchase arrangement with Nellis AFB and the REC Agreement with Nevada Power made the project somewhat less than financeable. The most significant instance involved the change-in-law risk associated with the REC agreement. If the Public Utility Commission of Nevada had not issued an order that approved the contract and an associated stipulation that provided assurances regarding change-in-law risk, the project might not have been financed.

3. A National Renewable Portfolio Standard

Today, renewable energy resources provide a fraction of total U.S. energy, with the potential for significant growth. More than twenty-seven states and the District of Columbia utilize a wide variety of renewable portfolio standard (RPS) mechanisms to drive a greater reliance on renewable energy. A basic RPS requires the electric utilities (investor-owned utilities and publicly-owned utilities) within a state to procure a percentage of their electricity output necessary to meet load from renewable energy sources in a specified timeframe. Current State policies require varying percentages of renewables, typically targeting a goal of one percent to five percent in the first year, increasing each year to achieve a goal of five percent to 20 percent over approximately 10-15 years.

In general, a utility can meet RPS requirements by incorporating renewable energy into its fuel mix in one of four ways: (1) building renewable energy facilities; (2) purchasing power directly from an existing renewable energy source; (3) buying RECs; or (4) by encouraging production of distributed renewable energy, efficiency, or conservation. The specifics of each RPS program vary widely state to state from the goal, to the criteria, to the method of implementation. Many State programs set standards for specific technologies to ensure diversity of electricity supply by supporting the development of promising technologies that may not currently be the most economic.

A national RPS would set the minimum standard for wholesale renewable energy usage throughout the United States. This would serve the important function of guaranteeing a minimum degree of market demand for renewable energy generation. Every state would be required to develop an energy regulatory strategy that includes a base level RPS with performance-based metrics that would drive investment in, and adoption of, viable, cost-effective renewable energy technologies. Specifically, Congress would mandate the establishment of minimum State renewable energy procurement standards with ample flexibility for State programs that surpass the federal minimum standards, encouraging dissemination of best regulatory and utility procurement practices, and providing states with incentives to increase reliance on renewable energy, reward energy efficiency, and to provide for a national REC market. For the reasons stated previously regarding stability, it is important that a national RPS is cognizant of existing State programs to ensure long-term investments already undertaken are not adversely affected. The federal RPS would require sufficient non-compliance measures in order to provide a strong incentive for utility compliance.

A national RPS can be a market driving, demand side solution for addressing the broader goals of energy policy through development of diverse, secure renewable energy sources and energy efficiency, while at the same time encouraging technological advances throughout the energy supply chain. The future of renewable energy production in the United States resides in this synergy of governmental policy and emerging technologies-and without each, the aim of diversified, sustainable, and efficient energy production is simply impossible in the foreseeable future. By setting these aggressive goals for renewable energy production targets, the government will drive innovation and the market will create solutions.

4. Valuing Carbon Emissions and Other Externalities The current cost of conventional fossil-fuel electricity does not include the environmental and social costs associated with the emission of carbon, mercury, and other pollutants into the atmosphere. Either a cap-and-trade system or emission specific taxes would complement long-term subsidies and the establishment of minimum market demand by internalizing the impact of burning fossil fuels into the price of electricity. This would tend to make solar energy more competitive with fossil fuelfired electricity and further boost investment.

Market Differences in the Southwest

The southwestern portion of the U.S. including California, Nevada, Arizona, and New Mexico has the strongest solar resource in the country. The State of Nevada has an RPS-driven REC market that provides a large part of the economics for the Nellis solar project. The RPS rules for the state have specific requirements for solar and applies a multiplier to RECs (termed Portfolio Energy Credits under the Nevada RPS) produced by solar facilities. RPS programs in the other three states exist, but are not necessarily structured properly for significant market penetration of utility-scale solar projects.

California

California has catalyzed solar development through the California Solar Initiative (CSI) program which utilizes a short-term production based incentive. This direct subsidy has spurred the development of distributed generation projects (mostly less than one megawatt), but is not applicable for utility-scale projects. It is expected that California will introduce a tradable REC program for the existing state RPS in the near future that will encourage distributed generation projects currently suffering from subsidy levels declining faster than capital costs for key equipment. California utilities have utilized a request for offer (RFO) process fulfilling their RPS requirements. Since there is no solar set-aside, most of these contracts have been awarded to other renewable technologies that are currently more cost effective than solar. Contracts which have been awarded to solar projects under the RFO process have largely gone to earlier stage solar technologies that have yet to be implemented. The California Public Utilities Commission recently announced a feedin tariff based on the a revised calculation methodology for the "market price referent" that sets the ceiling price for contracts awarded in the RFO process. The new methodology attempts to take into account the time-of-use benefits associated with the solar production curve matching well with the state-wide demand in California. The current consensus is that the announced feed-in tariff does not provide adequate levels of compensation for solar PV projects.

Arizona

There are certain regulatory hurdles that impede the development of solar and other clean technologies in Arizona. Low energy rates and tariff structures that do not adequately incentivize the peak-producing benefit of solar negatively impacts the economics of solar. Net-metering policies are essential to opening up the market to more wide-spread adoption, instead of limiting potential customers only to those who have 365 day operations, and large load centers. Under the current net-metering rules only small systems are rewarded, otherwise solar generation that exceeds on-site usage is not compensated for. Like net-metering, interconnection standards must be standardized across the state and have a minimum of 2MW to sufficiently promote industry adoption. Lastly the available incentives are insufficient. APS has taken the lead in establishing a PBI program, which is an important step, and for the most part well-designed (20 year PBI structure), however the total available funding is only enough to fund a few MW per year-which is not enough to entice the solar PV industry to undertake the cost and risk of entering a new market.

New Mexico

New Mexico has shown true leadership in the aggressive RPS goals and high net metering limits. This includes solar specific requirements that must be fulfilled beginning in 2011. The law also includes a "Reasonable Cost Threshold" which limits the payment of power from solar installations to currently unfinanceable levels.

Conclusion

Investors are beginning to respond to the market driving incentives for solar energy provided by Federal and State governments. The Nellis AFB project is a great example of how these types of incentives can be combined to create a viable project opportunity when a third-party can enter and efficiently monetize the tax benefits. These types of projects will only reach the volumes required to significantly reduce the cost of solar energy if the incentive programs are structured to ensure the creation of a stable, long-term market for project developers, installers, equipment manufacturers, and investors. The geographic market for these opportunities could be expended greatly through several actions at the federal level including a national RPS and the adoption of a market mechanism for internalizing the external costs of emissions from conventional sources of energy.

Arizona Solar Energy Industry Analyst Research Firms

Arizona Solar Power & Energy Research Reports

Arizona Solar Power & Energy Manufucturers

Arizona Solar Power & Energy Projects in Arizona

Arizona Solar Power & Energy Economic Development Groups

Arizona Solar Power Associations

Arizona Solar Power Companies Building New Facilities in Arizona

Arizona Corporation Commission - Solar Regulation

Arizona Solar Power & Energy Legislature Contacts

Congressional Solar Power & Energy Government Contacts

U.S. House of Representatives Solar Energy Sponsors
U.S. Senate Solar Energy Sponsors

Arizona Solar Power & Energy Requests for Proposals

Arizona Solar Power & Energy Technology

Arizona Solar Power & Energy PR Contacts for Solar Story Development

Arizona Solar Power & Energy University Research Programs

How to Get a Degree in Solar Energy

Eight Free Solar Energy Tutorials

Arizona State University Creates Solar Power Laboratory

Free Solar Lecture Series in Scottsdale

Arizona State University joins forces with TUV Rheinland Group to create the most comprehensive, sophisticated, state-of-the-art facility for testing and certification of solar energy equipment in the world. Press Release.

Arizona State University (ASU) Solar Testing and Research (STAR) Laboratory - ASU's Photovoltaic Testing Laboratory was established in 1992 to develop criteria for solar PV certification and, later, testing equipment. Since 1997, PTL has issued more than 250 qualification certificates and tested more than 2,500 solar modules for more than 150 companies representing 18 countries. The lab is the first accredited PV qualification testing laboratory in the U.S. and one of only a few in the world. It is part of ASU's Solar Initiative, which brings together ASU expertise and facilities on numerous aspects of solar energy research and development. Click here to take a virtual tour of STAR.

University of Arizona - Arizona Research Institute for Solar Energy

Northern Arizona University (NAU) - Solar Energy Passive Research Laboratory

  • B. Scott Canada - Mr. Canada is currently is a project engineer at the Arizona Public Service (APS) Solar Test and Research (STAR) facility in Tempe, AZ. Scott was raised and educated in Texas where he obtained a bachelor of science in chemical engineering from Texas Tech University in 1997. In 1999, Scott joined the APS STAR team where he has worked on a wide variety of solar electric projects and programs. These projects include both grid-connected and remote photovoltaic systems in a variety of applications and sizes. Currently, Scott is overseeing the installation of a 1 MWe solar trough plant south of Phoenix.
  • Herb Hayden - APS Solar Program Leader
  • Bob Hammond - Arizona State University Solar Program

Arizona Solar Power & Energy Venture Capital Firms

  • MMA Renewable Ventures - A wholly-owned subsidiary of Municipal Mortgage & Equity, LLC (OTC: MMAB.PK), MMA Renewable Ventures is a provider of renewable energy to businesses, utilities and government. The company develops, finances, owns and operates solar, wind, biomass and energy efficiency projects that provide clean power to our customers without capital investment or maintenance costs. MMA Renewable Ventures is dedicated to delivering competitively-priced, clean energy and energy savings to customers, strong partnership options for project developers, and exceptional opportunities for institutional investment in the clean energy sector. Our team of engineers, financiers and project managers are passionate about building a sustainable future.
  • Oak Leaf Energy Partners - Oak Leaf Energy Partners was founded in 2005 to provide project development and consulting services for renewable energy transactions. The company helps property owners deploy solar and other renewable energy derived power across their portfolio of buildings and properties. Oak Leaf Energy Partners (OEP) provides full turnkey development solutions, including feasibility studies, site planning and interconnection analysis, tax and financial structuring and negotiating financing and EPC contracts. Since its founding, the Company has emerged as one of the largest and most active solar energy developers in the Rocky Mountain West, with a growing regional and international footprint and pipeline.
  • Draper Fisher Jurvetson Solar Capital Investment
  • Firelake Solar Capital Investment
  • Good Energies Solar Capital Investment

Arizona Solar Energy Lease Finance Companies

Arizona Solar Power & Energy Retail Locations

Arizona Solar Power & Energy Distributors/Resellers

Arizona Public Utility Solar Energy Programs

Arizona Solar Rebates, Incentives, Tax Credits and Property Tax Discounts

National Solar Power & Energy Corporate Customer Testimonials

Arizona Solar Power & Energy Residential Customer Testimonials

Stories we would like to pitch to the media:

  • Arizona is the #1 Location in the United States for Utility Grade (CSP) Solar Energy Plants
  • Do Not Miss the Gold Rush for Arizona's Golden Desert Parcels
  • Does Arizona Need a Feed-in Tariff to Power the Solar Energy
  • The Federal Investment Tax Credit Will Create 10,000 Jobs in Arizona
  • Funding 1 gigaWatt of Solar Power in Arizona results in:
    1. $3-$4 billion private investment in the state of Arizona;
    2. 3,400-5,000 construction jobs; up to 200 permanent solar plant jobs, many in rural areas;
    3. $1.3-$1.9 billion 30-yr. increase in State tax revenues; and
    4. $4-$5 billion increase in Gross State Product
  • Successful Solar Installations in Arizona
  • Need a State/Federal Tax Credit?
  • How to Issue a Solar RFP
  • Focus on the Top 10 Solar Goldmines in America
  • Join Solar Power Association Near You
  • How to Get a Free Energy Audit for Your Business
  • How to Get a Free Energy Audit for Your Home
  • Why Adding Solar Can Help Stimulate the Economy
  • Building Homes with Solar Power Earn More Equity
  • Consumers Unknowingly Paying for Solar; How to Recoup Your Hard-earned Dollars
  • Buyer's Guide to Solar Energy Panels
  • Where to Get a Free Tuturial on Solar Technology
  • How to Use Net Metering to Make Your Electric Meter Spin Backwards
  • Where to Get Free Money to Pay for Your Solar Installation
  • CFL Light Bulbs: Another Way to Reduce Electricity Bills
  • How to Make Money Leasing Your Roof to Solar Developers
  • Setting Solar Goals for the Arizona Solar Industry
  • Investing in Solar to Power Your Home

Other Solar Power Information Links

 

 

 



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