Solar Energy in Missouri: The Impending Insurgency of Clean Electricity

Global concerns about how electricity and energy are generated has led to increased scrutiny on fossil fuel sources and enhanced the focus on creating sustainable renewable forms of energy in the last few decades. While some interpret this shift towards as the the writing on the wall signaling the beginning of the end of fossil fuels, others like the World Economic Forum recognize that those forms of energy still have a large role to play in the future, even though it may be more of a supporting role rather than the lead.

Renewable energy sources, everything ranging from hydro power to geothermal power to the burning of waste and wood to solar, tidal and wind power have their own problems and benefits attached to them, but each of them gets around the primary problem of fossil fuel sources: limited supply. Natural gas, coal and oil are finite resources, and while technology continues to make extracting the most from the earth possible and making what we have more efficient, eventually those supplies will run out or become rare enough that the expense simply won’t be worth their use.

As the name suggests, renewable resources have a theoretically or practically unlimited supply. The wind will blow and the sun will shine for billions of years into the future. Some like renewable energy because some sources tend to be more environmentally friendly, and others appreciate the reliability and independence they can offer. Around 13 percent of the energy in the United States is made from renewable energy. About eight percent is hydroelectric dams, five percent is wind power, and less than one percent is solar power. But that last category is one where some experts, including those in Missouri, believe the most gains can be made.

What’s usually considered the largest impediment to solar power is available sunlight. In rainy cities like Seattle, photovoltaics make little sense. However, Missouri has more solar potential than most parts of Germany, which generates almost seven percent of its total energy from solar panels.

The process itself is a bit complex, but this TED-Ed video does a good job of explaining how photovoltaic (PV) cells harness sunlight to generate energy.

Those PV panels have become increasingly more efficient and less expensive since the invention of the first practical silicon cells in 1954 by Bell Labs. Sen. Jason Holsman, D-Kansas City, is recognized as one of the most avid proponents of solar energy in the Capitol, having filed legislation related to benefiting it and other renewables in each of his three years in the Senate and six years in the House. He notes that the technology has gotten much better in the last decade, about as long as he has been in Jefferson City.

“In 2007, solar install costs were a little over $12 a watt. Today, it’s $3.50 a watt,” he says. He also believes that advancements in battery storage, which currently lags behind generation will make solar a much more realistic option for homeowners and homebuyers. “As battery technology evolves and storage meets generation in efficiency, you’re really going to see solar be an integral part of new building development for residential areas. That’s the future.”

Caleb Arthur is the CEO of Sun Solar, a residential solar panel installation company that has operations in Columbia, St. Louis, Kansas City, Springfield and Houston, Missouri. He is also the president of the Missouri Solar Energy Industry Association, which vets new solar system providers and advocates for policy beneficial to the solar industry in the Capitol. He agrees with Holsman, but he says that improved battery technology has already paved the way for more residential solar panel installation.

“With how battery costs have come down so rapidly, we’re probably within five years of homeowners being able to install battery packs along with their solar panels and not even need their utility companies,” Arthur says. “We’re installing so much now in the United States our manufacturing sectors haven’t been able to keep up… It’s an amazing problem to have.”

However, making sure that technology still makes its way to the consumer is still contingent on multiple factors, among them policy and economics. The Net Metering and Easy Connection Act, which went into effect in Oct. 2008, was perhaps the most important piece of legislation in the state to furthering the proliferation of solar power. Net metering essentially allows any ratepayer, a residential, or commercial utilities consumer or otherwise, to sell back extra electricity generated by a renewable energy source and put onto the grid. A standard residential ten kW photovoltaic system generates about 1,000 kWh of electricity each month. While some of those 1,000 kWh will be used by the resident, some of it will not, and the utility will refund the consumer a one-to-one dollar price match for each unused unit of energy.

Before the Easy Connection Act, utilities only had to pay 20 cents on the dollar.

“That is the bedrock for what allows the solar industry to exist,” says Mark Walter, the deputy director of Renew Missouri. “It guarantees that customers of a utility in this state will be able to connect a solar array on their roof, feed the energy back onto the grid and get credit for the energy they put onto the grid.”

Holsman said that law changed the state from having just a handful of houses with solar power to producing what is now about 180 megawatts.

“We saw a massive explosion in both commercial and residential rooftop solar systems…and the solar rebate program was largely to thank for that growth,” Holsman said.

Some federal policies also assisted the solar industry. The Residential Renewable Energy Tax Credit will offer a tax rebate of up to 30 percent of the cost of a new solar system through the end of 2019, although that rebate will decrease to 22 percent by 2022. Still, for the next two and a half years, the $30,000 Arthur says is a typical price for a ten kW system essentially shrinks to as little as $21,000.

Arthur also says some utilities in Missouri had taken steps in the past to encourage their consumers to buy solar panels. Ameren Missouri had a $2.00 per watt solar rebate, but they have stopped offering those rebates as of 2013 as a one percent cap on rate increases caused Ameren and other utilities to shutter their rebate programs. The City of Columbia, which manages its own utilities, offers a $500 per kW rebate (up to 10 kW) to those who purchase solar panels.

In Columbia, that $30,000 10 kWh system can get as low as $16,000, which helps consumers get past one of the biggest problems with solar panels, the prohibitive upfront cost. Arthur says alleviating that barrier gets at the heart of why some people want their own rooftop solar panels. Most people do not switch to solar to lessen their carbon footprint or for environmental reasons – they do it, he says, because it’s just cheaper.

“We’re not doing this for the uber rich. We’re doing this for the regular middle class Americans,” Arthur says. “Our average homeowner that goes solar, their median household income between two people is anywhere between $50,000 to $60,000 a year.”

Walter notes that large consumer stores, like Wal-Mart, want to get in on that power savings by putting much larger solar systems, about one megawatt, on the roofs of their stores. The relatively new IKEA store in St. Louis has a rooftop solar array that can generate nearly 1.7 megawatts of electricity. To incentivize more box stores to build those arrays, Walter says changes will have to be made to the current net metering policy.

“Missouri’s net metering policy is helpful, but we have a fairly low installation cap for system sizes so you can only install and get credit for 100 kW of installation – which is a fine deal for a small commercial system, but big industries want to get credit for more clean energy,” Walter says.

Still, he agrees that market forces and advances in technology will likely make solar an an eventual reality.

“The industry will take care of itself in terms of installing more solar, especially as the price continues to drop. It just makes sense for most customers.”

Holsman and Arthur believe it has job creation potential in the thousands as it takes people to manufacture and install solar panels, which also lose their effectiveness and need to be replaced every 30-40 years.

So while solar power occupies just a fraction of Missouri’s total energy production, those within the industry seem incredibly optimistic about the potential of solar power to become a widely-used resource by residential and consumer producers of electricity.