SEPA Germany trip highlights solar potential for U.S. utilities

The SEPA delegation visited a landfill powerplant site in Germany where this solar array and wind turbine are co-located. (Photo by Mike Taylor, Solar Electric Power Association)

Hoping that a close encounter with success might inspire imitation, the Solar Electric Power Association (SEPA) hosted 31 utilities on a five-day tour of the country with the most integrated renewable energy in the world.

Utility executives and managers, including some Western customers, traveled to Germany June 8 to 13 to meet with German utilities representatives. The fact-finding mission included visits to solar companies, multi-megawatt photovoltaic (PV) installations, a research institute and a solar module manufacturing plant.

Seeing mainstream solar

Inviting German solar experts to speak to the same group in the United States wouldn't have had as much impact, asserted SEPA Executive Director Julia Hamm. "Spending a full week talking about solar power with their U.S. colleagues—sometimes the only English-speakers around— forced the delegates to really focus on the issues," she said.

The specific goal in hosting a trip to a country with so much integrated solar in the power supply was twofold. German utilities get about 3 percent of their electricity from solar power, Hamm explained. "We wanted the representatives to talk to their counterparts in Germany to learn what kind of impact that much solar power has on the grid."

The association also wanted utilities to see that solar is a mainstream resource now, not something in the future. "Outside of California, a lot of utilities simply aren't aware that solar is a realistic option for their power supply and their customers," she stated.  

Technical, policy discoveries

What the delegation saw surprised even representatives from California utilities. Fred Fletcher, assistant general manager of power supply for Burbank Water and Power, admitted to learning that, "Some technologies we thought were still on the drawing board are ready to be developed as a business case. The trip changed the way we look at risk."

That from the utility that SEPA's 2007 U.S. Utility Solar Electricity Market Survey ranked eighth in the nation for solar electric capacity per customer on the customer side of the meter. The delegate from Salt River Project (SRP), another utility that ranked in the survey, agreed that solar technology is at a different stage in Germany. "Thin-film solar is the next hot technology there," said Lori Singleton, SRP manager for sustainability initiatives and technologies. "We would like to incorporate more of that into our mix."

Singleton was most interested in the policy aspects of developing so much solar power. "I wanted to learn more about Germany's feed-in tariff (FIT) and the associated costs to the customer," she said.

Under a FIT system, renewable electricity producers are paid a fixed, above-market rate for the electricity they feed into the grid. That cost is spread across all electricity consumers. In Germany, the estimated additional cost to the average family of three is about €2 per month—not as significant as Singleton expected.

Different approach to issues

As an engineer, Fletcher hoped to learn more about mass deployment of PV, he said. "We don't have much exposure to solar power on that scale here."

The amount of capacity Germany had installed and the quality of engineering impressed him. "The level of professionalism in the solar industry is very high—on par with electrical engineering in the United States," Fletcher said.  

The trip gave him an appreciation for the limitations of mass deployment, he added. German policy has succeeded in bringing down the cost of panels, but Fletcher thought more could be done to reduce integration costs, too. "Also, we saw a lot of hand-wiring of the panels into the grid," he said. "It would be better if the wiring was integrated into the frame or paneling."

Grid issues don't seem to stand in the way of Germany's solar development, however, Singleton noted. "German utilities just don't perceive that as the big barrier American utilities consider it to be."

The cost of solar technology was another area where there is a difference of opinion, she said. "The Germans believe that the cost will decrease significantly in the near future. In the U.S., even solar advocates expect it to take a long time for prices to drop," Singleton observed.

Mixed group enhances networking

Fletcher's and Singleton's views represented the different perspectives SEPA aimed for when selecting delegates for the mission. Participants came from investor-owned and public utilities, from urban, rural, large and small power providers. Most important, said Hamm, "Everyone was at a different level in their solar experience."

A surprising number of applicants came from outside the solar industry when SEPA announced the trip through Western, American Public Power Association and regional utility groups, Hamm recalled. Narrowing eligibility down to just utilities, there were still twice as many applications as the association could fund. "We planned to pay for 20 delegates," she said. "In the end, another 10 utility professionals paid their own way."

Mixing up the demographics led the delegates to learn from each other as well as from the Germans. Singleton called the trip a valuable opportunity to discuss renewables policies and customer issues with other U.S. utilities. Also, the one-on-one time she spent with German solar manufacturers offered the potential for creating partnerships with SRP.

What will and won't work

To gauge the mission's success, SEPA gave delegates pre-trip and post-trip evaluations to fill out. Two significant changes were how delegates ranked the general importance of solar power in a portfolio, before and after; and how soon they thought their utility might add solar generation. "Everyone moved up the scale after the trip," said Hamm. "They took solar more seriously and saw a place for it in their mix after seeing what was happening in Germany."

Still, there are cultural differences that would prevent American utilities from exactly duplicating the German solar experience. For example, Singleton points to Germany's FIT, noting, "Some municipalities and utilities have experimented with a tariff, but it probably wouldn't happen here without Federal legislation."

The FIT has helped to build Germany's solar industry in a way that net-metering in the United States has not matched. Germany has no net-metering rules—customers buy their power from the grid and sell electricity from their own arrays back to it. As the FIT decreases over time, PV owners will be paying more for power than they will make from selling it. "Customers in the U.S. would definitely have a problem with that," Fletcher said.

He also felt that German utilities are more accepting of government regulation. "Delegates would ask about the reason behind a regulation, and often as not, the utility representative couldn’t tell us—it was just the way things are done," Fletcher said.

Plenty of room to improve

That doesn't mean U.S. utilities can't find their own way to incorporate more solar power into the mix, Singleton is quick to say. "With all of the solar resources here, we should be able to do more," she insisted.

And utilities need to be open to all opportunities, she believes, recalling a sight that summed up Germany's attitude toward renewable resources, not just with solar, but with all renewable resources. The group was visiting a landfill powerplant that was capturing methane to generate power. A wind turbine on a hill overlooked the landfill, and solar panels were mounted on one side of the site. "And sheep were grazing under the panels," she said. "I’ve never seen that much renewable energy in one place."

Read the summary report, Solar Fact Finding Mission to Germany for Utility Decision Makers.

Resources

Solar Electric Power Association

Burbank Water and Power

2007 U.S. Utility Solar Electricity Market Survey

Salt River Project

American Public Power Association

Solar Fact Finding Mission to Germany for Utility Decision Makers

People

Julia Hamm

Fred Fletcher

Lori Singleton

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