By Matt Whittaker / NewsBreak Denver
(Denver, Colo.) Emboldened by the Inflation Reduction Act, local renewable energy companies say small-scale solar projects and grid improvements to connect them will be vital in transitioning the state’s power infrastructure from fossil fuels to renewable generation.
On Tuesday, in his second State of the Union address, President Joe Biden discussed energy policy that includes the Inflation Reduction Act, a bill local renewable energy companies say gives them a shot in the arm.
"The Inflation Reduction Act has been a huge catalyst for the Colorado solar and storage industry," said Mike Kruger, CEO of the Colorado Solar and Storage Association. "Demand from homeowners, businesses and utilities has increased and stayed elevated since the passage of the IRA."
In Colorado, total installed solar capacity rose to 2,309 megawatts in the third quarter from 2,268 during the second quarter, according to Solar Energy Industries Association numbers. That’s enough solar to power more than 450,000 homes and ranks Colorado 13th in the nation for installed solar capacity. The group projects Colorado will hit 3,595 megawatts over the next five years.
Kacie Peters, director of industry relationships for Denver-based national solar provider Pivot Energy, said community solar is crucial to the White House’s vision for a clean energy future and will be critical to meaningfully increasing solar production.
“Thanks to the historic Inflation Reduction Act, Pivot and other community solar developers can supercharge our efforts to reduce pollution, create jobs, and increase grid resiliency thanks to tax credits that drive developments that benefit high-impact communities,” she said. “The policy brings federal dollars to open markets to clean, affordable energy and creates a 10-year runway for carbon-free project development.”
Under community solar programs, also called shared solar or solar gardens, customers can buy or lease a portion of a solar farm and receive a credit on their electric bills for power generated by their share of the system, the U.S. Energy Department says. Members often pay for electricity generated at the farm that is cheaper than what they would pay from their utility company, according to EnergySage, an online solar, energy storage and project financing marketplace.
For Pivot, community solar projects are 1-5 megawatt arrays hooked up to utility grids and accessible by subscription to anyone who pays an electric bill.
As part of a distributed solar model that includes rooftop solar installations on homes and businesses, community solar provides private-sector investment in the power grid sited closer to customers than centralized power plants, Peters noted. The decentralized system will make the nation’s energy infrastructure more resilient in the face of extreme weather and increasing demand for electricity, she said.
Coloradans face high electricity bills partly because of costs associated with 2021’s Winter Storm Uri, which knocked out power to millions in Texas, resulting in utilities that serve Colorado spending more on natural gas.
There are drawbacks to community solar, according to EnergySage. One is that community solar customers often aren’t eligible for the solar incentives enjoyed by those who buy and own their solar array. Another is that community solar farms can take up a lot of space, requiring land clearing that can result in deforestation and habitat loss.
One way around this is to build solar farms on previously cleared land, such as a 324-acre parcel the state owns in Grand Junction, where people dump trash illegally. On about 150 acres there, Denver-based SolarGen is developing a 48-megawatt solar farm it expects to bring online in 2025.
“The land is presently uninhabited, has no water rights and is presently an eye sore,” said SolarGen CEO Carmine Iadarola.
For Iadarola, the most essential part of the Inflation Reduction Act is addressing transmission, which along with interconnection, is the biggest obstacle to developing a solar project.
“Transmission is very expensive, is a major cause of fires and is very susceptible to foreign interference,” Iadarola said. “One of the keys, as with phone wires, is distributed energy. Building an energy system that is distributed … will be very important for the next generation’s safety, and power reliability.”
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