Alberta’s residential solar industry has chugged along for decades without government support.
That dry spell finally drew to a close on Monday, when the provincial NDP government announced a two-year, $36 million rebate program to help bring down the costs for residents, business and nonprofits who want to install solar projects.
By 2020, the number of solar installations on rooftops is expected to increase from 1,800 to 10,000 systems, which will create about 900 jobs and reduce greenhouse gas emissions by a half million tonnes (or the same as taking 100,000 cars off the road).
“It’s the first time individuals and businesses (Read more…) the province will have support to install solar and have the independence of being able to generate their own electricity,” said Sara Hastings-Simon, the director of the Pembina Institute’s clean economy program.
Rebate Program Will Pay 75 Cents Per Installed Watt, Up to 30% of Cost
The 21-minute announcement was fairly short on details, with many of the specifics being worked out by the new Energy Efficiency Alberta agency. But the news is already being heralded as a “milestone” and “very significant” by solar advocates.
“Consumers are already excited about solar,” says David Kelly, CEO of SkyFire Energy, who was at Monday’s announcement. “There’s a lot of pent-up demand: people have been waiting for a program. And the industry is ready to deliver.”
In February 2016, the provincial government announced a $5.5 million rebate plan for municipalities and farms. Demand quickly outstripped available incentive programs for such sectors; the program is expected to fund 160 projects in total.
The Solar Energy Society of Alberta estimates that a solar photovoltaic system can be installed to accommodate an average household’s electricity demand — estimated at 7,200 kilowatt hours (kWh) per year — for about $18,000. The initial cost can be a deterrent for residential and business owners.
That’s where the new rebate program will come in, significantly reducing the payback period (cutting the current 15 to 20 year payback timeframe by about 30 per cent).
Minister of Environment and Climate Change Shannon Phillips, who announced the news on Monday, noted in the press conference that the rebate program will allow for rebates of 75 cents per installed watt, up to 30 per cent of total solar installation costs for residential and 25 per cent of solar installation costs for businesses and nonprofits.
Kelly notes that such figures aren’t as generous as some other jurisdictions. But that’s a good thing, he suggests, as you don’t want to “create a gold rush mentality for solar.”
Alberta Aims to Generate 30% of Electricity Via Renewables by 2030
It might sound a bit counterintuitive. But it’s something that Rob Harlan, executive director of the Solar Energy Society of Alberta, explains is necessary to prevent problems around quality and safety due to the industry expanding too quickly.
“Traditional electrical training doesn’t include a lot about solar technology yet,” he says. “Electricians need to have a little bit of additional training to do these systems well. If it becomes too lucrative too soon, you get a lot of sales and marketing people dominating the industry.”
The rebate program is just a small part of the province’s push to green its energy system, with the overall target of a complete phase-out of coal-fired power and 30 per cent renewable generation by 2030.
Larger solar projects have also become increasingly popular; the “connection queue” for the Alberta Electricity System Operator (AESO) hit 681 megawatts (MW) in September, and 1,453 MW in December.
That doesn’t guarantee that proponents will follow through with the project, but is certainly represents a solid measure of interest.
Hastings-Simon says the new rebate program will also benefit people who don’t choose to install solar, as it will reduce costly electricity generation during peak times and the need to build new transmission infrastructure.
More Can Be Done to Encourage Microgeneration, Advocates Say
In late December, the province amended the legislation on microgeneration, or small-scale generation for personal consumption, with excess power sold back to the grid.
The tweaks included increasing the size limit (from one MW to five MW) and allowing for solar systems to connect to adjacent sites (as opposed to having to be literally on the roof of the consumer). But some advocates suggest the micro-generation regulation be further amended to allow for the potential growth of residential solar.
“Right now, the microgeneration law limits system size to your past year’s consumption,” Harlan says. “We’d like to see that lifted. It’s important to limit system size by things like fuses, conductors and transformers: basic safety and technological issues. But why not allow somebody who has a commercial building with a large roof to sell it with solar modules and help clean Alberta’s grid?”
Pembina’s Hastings-Simon agrees, noting that it would be hugely helpful to make it possible to size systems larger than the load they’re immediately connected to.
That would mean that someone wanted to build a solar project with their neighbours, they could build it a central nearby location even if it’s not directly connected to each of their houses (but is instead connected via the distribution grid). In addition, “virtual net metering” would allow someone to have “virtual ownership of a solar panel” with credit applied to your electricity bill.