REPORT: ARIZ. RIPE FOR SOLAR ENERGY; STATE ONE OF TOP SPOTS IN NATION, STUDY SAYS
BYLINE: Mark Shaffer, The Arizona Republic
The state's solar-energy producers could generate 1,000 megawatts of power and create 3,000 jobs by 2020, according to the first solar-electric study prepared for the Arizona Department of Commerce.
The report, released Monday, also envisions a world-class solar research and development center for the state, which it says "has the best solar resources in the nation."
A total of 1,000 megawatts would provide enough power for 250,000 to 300,000 homes, according to utility company estimates.
When members of the Arizona Corporation Commission passed a renewable-energy standard last year, they paid particular interest to solar energy playing a dominant role in electric utilities generating 15 percent of their energy from renewable sources by 2025.
They also thought it would be key in distributed electric generation from residential or non-utility firms taking root, which is mandated to be 30 percent of the renewable energy production by 2011.
"Our challenge is to get Arizona on the international radar for solar-energy production," said Jon Fink, an Arizona State University vice president who was on the steering committee for the solar study.
"I've just been to China to meet with the head of the largest solar company there and will be going to Germany next week for the same thing," Fink said.
"Arizona and California have the best sun in the country, and Arizona, especially, has the most developable land for this endeavor."
But Steve Roman, a Phoenix business consultant and former solar-company employee who also was on the committee, said the road to solar power contains a number of obstacles.
"It's been subsidized by different governments and power companies for good reason but it's ultimately going to have to be successful without subsidies," Roman said.
"Maybe the subsidies will empower manufacturers and allow them to make cheaper products. But that hasn't happened yet and there's no silver bullet that will make it even double the price of traditional power."
According to the study, produced by Navigant Consulting of Burlington, Mass., residential solar costs just under 30 cents a kilowatt hour, three times the current retail rate.
With federal, state and utility company subsidies, that cost is about 18 cents a kilowatt hour.
But for businesses, the cost of solar energy is about seven times that of the 7 cents a kilowatt hour they pay for power, the report says.
The report notes that significant penetration of the market with photovoltaic cells will not happen until they pay back their costs with electric generation within 10 years. That will not happen until 2020 at the earliest, according to the report.
If technological advances allow the solar market to really take off, the report notes that more than 2,600 megawatts could be produced by 2025, with 45 percent of that from the rooftops of homes.
Under that scenario, 440,000 tons of emissions from power plants that use fossil fuels, such as coal, would be eliminated.
The report cited a number of advantages Arizona has for solar-power development, such as being centrally located in the Southwest and having abundant state trust lands for large solar developments.
It also noted that the renewable energy standard would provide $1.2 billion in funding through 2025 and the state's growth rate and pro-business climate.
The report also noted that ASU has the only certified solar module testing laboratory in the country and that the University of Arizona is involved in solar-cell research and has a facility for evaluating emerging technologies.
But Arizona also has shortcomings, according to the report, such as a lack of capital infusion, competition from neighboring states and numerous homeowner associations that restrict installation of solar units.
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Reach the reporter at mark.shaffer@arizonarepublicor (602) 444-8057.