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Governor's budget and the solar saw-buck

by Evan R. Endres
Every year, the Solar Jobs census is released and every year, I write a blog about how Pennsylvania has fallen behind other states. Here we go... For the 2014 Solar Jobs Census, we are now 15th in the nation, with only about 2,800 employed in the solar industry in Pennsylvania. Since 2012, when we were fifth in the nation for solar jobs, ten other states have moved ahead of us. Yep, we've lost about 1,800 solar jobs since 2012 and our neighbors, New Jersey and New York, rank in the top five nationally. Okay, now the good news: This year, the jobs report was released at about the same time Gov. Tom Wolf issued his 2015/2016 budget proposal, where solar silver linings abound. 

Gov. Wolf’s proposal is to direct $50 million to the successful Pennsylvania Sunshine Rebate program. This should be welcome news to renewable energy boosters and Pennsylvania’s solar industry. From 2009 through the end of 2013, this program distributed over $103 million in solar rebates to Pennsylvania’s residential and commercial sector. The distribution of these funds resulted in over half a billion dollars in immediate economic activity for the state and continues to pay dividends in the form of energy savings for the over 7,000 homeowners and businesses who took advantage of the program. 

Because costs for solar have declined overall, the allocation of $50 million in additional funds could result in the installation of 11,000-18,000 solar projects for the state. 

Avoiding a boom and bust: It is important to recognize that Pennsylvania's solar industry has endured several boom-bust cycles over the last several years. Due to the declining cost of solar and pent-up demand, $50 million may go fast, creating another such boom and bust. Steps should be taken to analyze and modify program parameters and rebate levels so that the program has the greatest potential to spur the development of the maximal volume of new installations. The last incentive level offered by the program was $.75 per watt with maximum rebates per project set at $7,500 for residential and $52,000 for commercial installations. Both the per-watt rebate amount and the overall project cap may deserve reconsideration. 

The need for financing: Although the risk of financing solar has proven to be low, consumer and commercial solar loan products are scarce, especially in Pennsylvania. States like New York and Connecticut have hedged their own funds to back loan programs that offer competitive rates for solar energy to make up for the lack of private equity. Pennsylvania should follow suit. The Governor's budget proposes $100 million in "Alternative Energy" funding, the details of which have not yet been announced. Renewable energy advocates should hope that the development of financing is part of the plan.

Financing support for solar energy may be as important, or even more important, in the long term then the revitalization of the PA Sunshine program alone. And the concept is not new to Pennsylvania: The Pennsylvania Treasury has backed energy efficiency improvements for homeowners through the Keystone HELP program since 2009 and may be well positioned to offer a solar loan product if the right funding reserves are made available. 

The Governor's budget, if enacted, has the potential to turn the years of bad news that came with the release of the annual solar jobs census into something of which we can be proud once more. Renewable energy boosters should voice their support for the budget while challenging the office to make smart choices and do more to avoid the bust cycle of the past.

Evan Endres is program manager for the PennFuture Energy Center and is based in Pittsburgh. He tweets @ER_Endres.


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