In a surprise twist, Illinois -- which is home to a quarter of the nation’s bituminous coal reserves and generates more nuclear power (and waste) than any state in the country – is primed to become a leader in renewable energy. Our state’s renewable energy portfolio standard calls for Illinois utilities and alternative retail electric suppliers (ARES) to meet 25% of electricity needs through renewable resources, such as solar and wind, by 2025. That standard is among the nation’s most aggressive requirements.
These policy developments, coupled with sinking costs, have helped spur massive growth in Illinois’ wind power industry in recent years: Illinois has seen a nearly 20-fold increase in installed wind power capacity since 2005, with wind power now able to generate nearly 2000 megawatts (MW) of electricity.
But we’ve been very slow on solar. The City of Chicago features only about 2 MW of installed solar capacity – less than 53 separate cities in California alone. Statewide, Illinois only has about 3.3 MW of installed solar online. That’s 20 times less than New Jersey.
It isn’t for lack of potential. In fact, the Midwest has greater solar intensity and more solar potential than Germany or Japan, two of the world’s leaders in solar power. The Chicagoland area features acres of rooftop space that could be blanketed with solar photovoltaic (PV) panels, lessening our dependence on fossil fuels and polluting energy resources.
Rays of Hope
There’s reason to believe a shift is on the horizon. Recent developments and current advocacy efforts are setting the stage for a major breakthrough on solar, setting up the Chicagoland area as a potential leader in solar energy, as well as the manufacturing and installation jobs that come along with it.
First, due to a confluence of factors – federal loan guarantees via the stimulus package, reduced panel costs, and readily available labor – the Chicagoland area has strong potential for the development of urban solar plants. A 10 MW Exelon solar facility on an unused industrial brownfield site in Chicago’s West Pullman neighborhood is scheduled to be online and operating in 2010. Set to be the largest urban solar plant in the country, the site will feature over 33,000 PV panels generating enough electricity to power 1200 to 1500 homes – all while creating nearly 200 construction and installation jobs to assemble the plant. Similar projects may soon be in the works.
Second, Illinois features strong tax credits for solar systems. The Illinois Department of Commerce and Economic Opportunity offers a solar energy rebate program providing tax rebates of up to 30% of a project’s cost (with a maximum of $50,000). When coupled with similar federal tax credits, going solar makes good economic sense for families in Illinois.
Third, Illinois’s renewable energy standard features a specific provision requiring that a small portion of Illinois’s renewables must come from solar, starting in 2015. Illinois also allows for limited “net metering” – meaning that your electric meter runs backwards for excess solar power fed back onto the grid.
What’s on the Horizon
From a policy standpoint, environmental advocates are working on a few ways to do better. For instance, because the current requirement that Illinois utilities procure solar power will not kick in until 2015, Illinois law currently fails to provide market certainty for solar project developers. Immediate market certainty is especially important for solar projects, as they can move from conception to construction in less than a year. By requiring utilities to begin procuring small amounts of solar power as soon as 2011, we can enjoy the advantages of being a first-mover on this key energy resource.
Our net metering rules can also be rewritten to bring large energy users into the fold and ensure real-time pricing for power. In particular, commercial and industrial users – such as big box retail merchants and warehouses – should be encouraged to reduce their energy footprint by going solar. Allowing them to receive full value for power fed back onto the grid is crucial to that transformation. And because sunlight comes at times of peak power demand, the value for all solar fed back to the grid should reflect the actual retail price of power at the time it was generated.
Chicagoland municipalities should also take advantage of novel financing systems designed to remove the high upfront costs of solar installations. For instance, property assessed clean energy financing (PACE financing) allows property owners to pay for solar systems though an increase in their individual property taxes. Should the property change hands, the new owner continues the additional payments until the cost of the system is paid in full.
Through these policy changes, coupled with continually improving technology and lowering costs, the stage will be set for solar energy to shine in the windy city and surrounding areas.
