Why is Solar Energy Inhibited in Florida?
One would think that Florida, the “Sunshine State, would rank higher than 13th in solar energy generation and that solar would provide more than just 2% of the energy mix for the state. This is because Florida is one of only four states that requires that solar energy be sold exclusively by the utilities companies. Direct sales by private companies that install solar panels is banned in this state. The state also further taxes commercial property owners who install solar arrays.
Other states allow businesses and property owners to install solar panels and sell excess energy back to the utility grids. Since the average price of photovoltaic cells has plummeted 60 percent since 2010, due to lower production costs and moreefficient design, solar energy is now a very viable option for clean energy production.
Other states also allow solar power purchase agreements. These are financial agreements where a developer arranges for the design, permitting, financing and installation of a solar energy system on a customer’s property at little to no cost. The developer sells the power generated to the host customer at a fixed rate that is typically lower than the local utility’s retail rate. This lower electricity price serves to offset the customer’s purchase of electricity from the grid while the developer receives the income from these sales of electricity as well as any tax credits and other incentives generated from the system.
The utility companies oppose the freemarket use of solar energy since it will reduce demand and their financial bottom line. They argue that since there would be less demand on the grid, the cost of energy for those without solar energy would increase. However, since solar energy reduces demand on the grid, it would not be necessary to construct new power stations, which are a major expense, and environmental concerns with energy production would be greatly alleviated.
The solar energy dilemma in Florida may soon be changing since a broad coalition of both conservatives and liberals have come together for expansion of solar energy in the state through a constitutional amendment. The ballot initiative allows for more competition in the electricity market and does not involve subsides or mandates. The success of the petition drive has triggered a review of the ballot language by the Florida Supreme Court. If the initiative takes hold and opens up the free market, solar energy will take off in the Sunshine State.
Raymond Young, Ph.D.
Sarasota Sister Cities Association
Other states also allow solar power purchase agreements. These are financial agreements where a developer arranges for the design, permitting, financing and installation of a solar energy system on a customer’s property at little to no cost. The developer sells the power generated to the host customer at a fixed rate that is typically lower than the local utility’s retail rate. This lower electricity price serves to offset the customer’s purchase of electricity from the grid while the developer receives the income from these sales of electricity as well as any tax credits and other incentives generated from the system.
The utility companies oppose the freemarket use of solar energy since it will reduce demand and their financial bottom line. They argue that since there would be less demand on the grid, the cost of energy for those without solar energy would increase. However, since solar energy reduces demand on the grid, it would not be necessary to construct new power stations, which are a major expense, and environmental concerns with energy production would be greatly alleviated.
The solar energy dilemma in Florida may soon be changing since a broad coalition of both conservatives and liberals have come together for expansion of solar energy in the state through a constitutional amendment. The ballot initiative allows for more competition in the electricity market and does not involve subsides or mandates. The success of the petition drive has triggered a review of the ballot language by the Florida Supreme Court. If the initiative takes hold and opens up the free market, solar energy will take off in the Sunshine State.
Raymond Young, Ph.D.
Sarasota Sister Cities Association