San Antonio takes different tack on solar energy

Bill Loveless | Special for USA TODAY

San Antonio is one of the leading cities for solar energy in the United States, with photovoltaic systems on nearly 2,500 roofs and a solar farm in the works that will power the equivalent of 70,000 homes.

Leading the effort is Doyle Beneby, the CEO of the city-owned utility, CPS Energy, which not only instituted a rooftop solar program that provides rebates for homeowners installing PV systems, but also negotiated deals with companies such as OCI Solar Power, the developer of the 400 megawatt solar farm.

That arrangement with OCI Solar Power is the largest economic development agreement between a municipal utility and a private company in the U.S., one that promises to create 800 permanent jobs once it's completed in 2016.

Taken together, the solar energy advances in San Antonio are part of CPS Energy's Save for Tomorrow Energy Plan, which aims to reduce growth in the community's electricity needs by 770 megawatts by 2020, or the equivalent of a large power plant.

Now, CPS Energy is experimenting with a new pilot program that it says will make rooftop solar available to more San Antonio residents, including low-income households where PV panels are noticeably absent.

"We've tried diligently for a couple of years now to satisfy some of the needs of our solar stakeholders," Beneby says. "But we've also tried very hard to make solar available to every part of our community. For the first few years or so, the solar installations have been collected around some of the higher-income ZIP codes. We've thought about that for a while now. We want something for the masses."

Under the new program, CPS Energy plans to hire a developer who, representing the utility, will install and maintain solar systems on residential and small-commercial rooftops at no cost to the customers. CPS Energy will buy the output, and the developer will pay the customers for the use of their roofs.

"It's a way for folks who otherwise would not be able to partake in solar to be involved," Beneby says. "There's no upfront capital cost (for customers), and there's no monthly cost. So, it's fairly unique in that regard."

Companies that install and lease rooftop solar systems dispute Beneby's assertion that lower-income, and even many middle-income, homeowners are left in the dark, when it comes to solar power.

Among them is Lyndon Rive, CEO of SolarCity, one of the leading solar panel installers in the U.S., who says CPS Energy has squeezed out many households by prohibiting leasing arrangements, a popular means of going solar for households across the U.S.

The Alliance for Solar Choice, which represents SolarCity and other large solar providers, opposes the new CPS Energy program.

Beneby is no stranger to controversy in solar circles. Like many utility executives in the U.S., he says net metering, the mechanism CPS Energy and other power companies use to credit solar homeowners for excess power they generate but don't use, is unfair to utilities.

Under net metering, utilities typically pay a monthly credit equivalent to the retail price of electricity. Beneby and other critics maintain that the payment doesn't take into account the utility's fixed costs for power lines and other infrastructure that solar homeowners still use.

Rive and other solar providers dispute that point of view.

Last year, CPS Energy proposed a monthly service fee for homeowners who own rooftop solar panels, only to drop the idea in the face of local opposition.

Now, Beneby is counting on local support for the new CPS Energy program, and so far, he sees some signs of that. Among those endorsing the initiative is San Antonio Solar, a non-profit advocacy group.

"This program has the potential to expand to all rooftops in San Antonio regardless of the host's financial status or credit score," said Anita Ledbetter, the interim executive director of San Antonio Solar. "I think if you asked the citizens of San Antonio, do you want to buy or lease your solar panels from an outside company and risk uncertainty, or do you want the utility you own to come put them on your roof for no upfront costs to you, with a guaranteed benefit, I think people will want the latter."

Whether CPS Energy's latest strategy for solar energy flies or not, and whether it serves as a model for other utilities, may be known soon. The deadline for solar developers to respond to the San Antonio utility's new initiative is March 6.

Bill Loveless is a veteran energy journalist and television commentator in Washington. He is a former host of the TV program Platts Energy Week.