Solar Rebate Program’s Final Go-Around in the District

Derrick Haynes-Moore

Ward 1 and Ward 6 residents were the top 2 rebate recipients.

The national power grid that generates electricity for anything with a plug is overworked. Some consumers, including droves of district residents, have decided to tackle this issue head-on, by becoming their own energy producers and going solar.

Hundreds of D.C. residents interested in having solar photovoltaic panels installed onto their homes have signed up for the local government’s Renewable Energy Incentive Program, also known as REIP, to cut their upfront costs.  The incentive program, administered by the District Department of Environment, was created in 2008 after the D.C. council passed the Clean and Affordable Energy Act. The program restarted for its final fiscal year Oct. 1. 

Emil King, a policy analyst at the city’s Department of Environment, said 40 percent of REIP rebates were distributed to homeowners in Ward 1. The second largest rebate recipients lived in Ward 6, home to the Capitol Hill Energy Cooperative and Michael Barrette.   

For Barrette, the solar project director of the Capitol Hill Energy Cooperative, the REIP rebate shaved off nearly $12,000 from his initial cost of $26,500. The maximum rebate homeowners can receive is capped at $16,500 in the program’s last year.   DDOE has “ratcheted down” its incentive levels for rebate payments to correspond with the decreasing costs of solar panels. In 2010, the average applicant received a rebate similar to Barrette’s. Future REIP applicants should expect to receive less. 

Solar Solution, LLC, a solar energy installation company based in the district, installed a 19-paneled 4.4 kW system on Barrette’s Capitol Hill home in April 2010. Within in the next two or three years, Barrette said he will have a positive return on his investment, in addition to lowered electricity bills. 

I’m producing half of what I need right now, which is why I’m considering putting more panels on,” he said, “I want to get closer to a hundred percent.” 

So, Barrette applied to REIP again last year, but he was placed on a waiting list when funds for the annual $2 million program ran out for the 2011 fiscal year, which had been decreased to $1.8 million. A budgetary gap led the D.C. council to approve tapping an additional $709, 400 of REIP funds in December 2010 to plug the shortfall.   

The waiting list, which was closed in February 2011, totaled 414 residents and families seeking to take advantage of the program.   

The recently launched D.C. Sustainability Energy Utility, D.C. SEU, stepped in to provide a rebate to the top 15 homeowners on the waiting list before REIP was available again. 

Bill Lightfoot, 60, was lucky number fifteen.   

Lightfoot, an attorney and former D.C. council member, said he was motivated to install panels to save money and save the earth. The refund grant and the federal government incentives, which include a 30 percent tax credit program, also spurred him on. 

Lightfoot also said a then-presidential candidate Barack Obama campaigning during the 2008 election was as another source of encouragement.   

President Obama gave speeches about solar energy and how it was important,” Lightfoot said, “He convinced me by listening to his speeches that it was the right thing to do to save the planet and create jobs.”  And a summer report released by the Brookings Institute demonstrated that “green jobs” has inched ahead of their fossil-fuel counterparts, narrowly.   

Sizing the Clean Economy: A Green Jobs Assessment” demonstrated that there were 2.7 million environmental-friendly jobs in 2010 – by comparison fossil-fuel industry jobs totaled 2.4 million. 

While waiting to receive his rebate, Lightfoot went ahead and paid Solar Energy World, LLC to install solar PV system generating 9.5 kW in December 2010. 

I’m saving on my electricity bill,” he said, adding that he probably saved about 40 percent per month with that percentage rate rising during sunnier summer months.   

Lightfoot recently received an email from D.C. SEU saying he would receive his rebate check in early October. 

Much further down on the waiting list, in the mid-200s, Corey Ramsden said he has only received an email from the DDOE confirming that he was still on the list.

Ramsden, an independent IT contractor and Capitol Hill Energy Cooperative member, said he wanted to do something to affect climate change.   

I already spent time trying to weatherize my own house,” Ramsden said, “The next thing I want to do is generate my own electricity.” 

But that goal has been postponed until he receives his REIP rebate.   

The hiccup in financing their PV systems forced many other applicants to ask solar installation companies like Astrum Solar and Solar Solution, LLC to postpone their installations since they would face more out-of-pocket costs without REIP. 

I didn’t make sense to do installations while they were waiting,” said Michelle Waldgeir, Astrum’s marketing vice president.   

Atta Kiarash, vice president of Solar Solution, said approximately half of the 400 plus wait-listed participants are customers waiting for incentive program’s re-launch. 

It’s a double-edged sword,” Kiarash said, referring to REIP, “Not only has it helped us grow and get new customers. It has also kind of slowed us down a bit.” 

With the grants being taken away, it definitely hurt us and it hurt customers who wanted to get the systems installed but now couldn’t,” he added. 

Kiarash said while some customers are extremely concerned about climate change and want to reduce their carbon footprint; most, however, are more concerned about what they pay to Pepco. 

I’m sure in the back of the mind they’re concerned about the environment,” he said.   

The financial benefit of when a homeowner’s PV system generates enough energy to offset their usage can make receiving their electricity bill a happy occasion. 

When Barrette opened his May 2011 electricity bill from Pepco, he saw a surprise worth smiling about: His bill was negative. 

That was my proud shining moment,” he said. “I was very excited when I opened that bill that month. I’m going to keep trying to get that negative month. I want them to owe me money.”  For homeowners without a PV system, their Pepco bills will not inspire smiles if a proposed rate hike is approved in spring 2012. 

On July 8, the utility company submitted a proposal to the city’s Public Service Commission requesting to increase service rate by approximately 10.2 percent.   

A month and a day later, Mayor Vincent Gray signed the Distributed Generation Amendment Act. The bill, originally introduced in January 2011, went into effect Oct. 20. and will increase the level of district’s solar energy mandate.  The law will raise the district’s solar energy requirement to .25 percent, from an original .04 percent – a 21-percentage point increase.   

And some D.C. officials fear that the legislation may also raise energy bills.

In a fiscal impact statement, Dr. Natwar Gandhi, the city’s chief financial officer writes, “The higher costs to comply with this proposed legislation will be passed along to energy consumers in the District, increasing energy bills.” 

The Fiscal Impact Statement speaks for itself so we have no comment beyond what is stated there,” David Umansky, the public affairs officer of the Office of the Chief Financial Officer, wrote in an emailed response.  “However, the legislation excludes contracts, and not companies.”   

Umansky noted that the district’s contract with Washington Gas Energy Services would have to be renegotiated when it expires in 2012 to meet the new solar requirements.   

Concerned about the impact of the distributed generation bill on utility rate-payers without PVs pushed the Public Service Commission’s Chairman Betty Ann Kane and the Interim’s People’s Counsel Brenda Pennington to oppose the measure at a March 2011 hearing, according to a committee report.

While Chairman Kane testified in court, Counsel Pennington and Pepco submitted written testimonies.  Thirty-five other witnesses, including Washington Gas Energy Services, testified in favor of the bill.  The latter said that the measure should be implemented gradually (“grandfathered in”).

Many said that the bill’s restriction on where utility companies can buy Solar Renewable Energy Credits, SRECs, will bolster the solar credit market that had been saturated, thus lowering value of D.C. residents’ solar credits.   

Currently, utility companies are permitted to purchase SRECs outside the city.  SRECs are sellable credits produced by homeowners with PV systems generate 1,000 kWh of electricity. A 1 kW solar system can generate 1,000 or more kWh per year.   

Barrette’s slightly larger 4.4 kW system has generated 9,840 kWh, as of March 8. He said he generates 5 solar credits annually and receives payments through the SREC broker company, Sol Systems.   

Homeowners can sell the credits themselves or hire companies such as Astrum, Solar Solution, or Sol Systems to do so on their behalves. Before dealing with solar credit brokers, they must register their PV system with their state’s SREC certifier.   

In the district, the Public Service Commission certifies SRECs.   

The primary buyers of SRECs are power-utility companies that operate in the district and 31 states that have a Renewable Portfolio Standard, REPS.

A REPS is a mandate that requires power suppliers to increase the amount of renewable energy sources that they use. 

Consumers’ anger at Pepco over its management of outages in the metropolitan area has already driven some residents “off-the-grid” and may further nudge others to follow suit. 

Kiarash said being off-the-grid could be defined in two ways.   

First, a homeowner can be disconnected from the power grid completely, generating all of their electricity from their solar PV system that is stored away in a battery backup system for energy use after sunset.   Or they can still be connected to the grid, but generate enough energy to offset all of their energy use by feeding the power their PV panels produced directly into the grid. 

We’re looking at taking people off-grid,” said Akili West, co-founder of the Ward 8 Renewable Energy Cooperative, “We see situations in Ward 8 where off-grid is better.” 

West, who is also the president of Reclamation Energy, LLC, helped found the Ward 8 REC in July 2010 to raise awareness about the potential for renewable energy and environmental issues in the ward.   The Ward 8 REC is a part of D.C. Solar United Neighborhoods, D.C. SUN, a group of 11 other solar and renewable energy co-ops in the city, including the Capitol Hill cooperative.   

You know how BP is ‘beyond petroleum’?” West asked, “We want to be BP, beyond Pepco. We want to have options as far energy is concerned.”