Article Sourced From: PECO.com – Click to View Original

PHILADELPHIA (March 3, 2010) PECO has signed 10-year agreements to purchase 6 megawatts, or 80,000 solar energy credits, in support of Pennsylvania’s Alternative Energy Portfolio Standards (AEPS). The purchases were made at an average price of $256.57 per megawatt hour.

Enough energy to power nearly 1,000 homes for 10 years, it would take about eight football fields of solar panels to produce the 6 megawatts purchased. Once complete, the company’s purchases could result in the same environmental benefit as planting more than 48,000 acres of trees or not driving more than 133 million miles.

The first utility in the state to buy and bank green energy credits, these solar purchases are in addition to more than 450,000 megawatt-hours of wind and other renewable energy credits already purchased by PECO since 2008.

“These purchases underscore our strong environmental focus and commitment to renewable energy for our customers,” said Denis P. O’Brien, PECO president and CEO. “By acting now PECO is helping to increase demand for renewable energy resources and promote clean energy technologies.”

The AEPS legislation requires that by 2011, 3.5 percent of the energy sold to PECO customers is generated from renewable resources such as wind, landfill gas, and solar. These requirements are measured by renewable energy credits. Credits are sold by electric generators on a one-to-one basis each time they produce one megawatt-hour of renewable energy.

PECO’s support of alternative energy is part of a broader environmental initiative to preserve the environment and help customers become more environmentally responsible. Totaling more than $15.3 million of work, the comprehensive program also includes the installation of a green roof and new energy efficient Crown Lights system at the company’s Center City headquarters; the opening of PECO’s first ‘green building’ in West Chester, recently awarded silver certification for Leadership in Energy and Environmental Design (LEED); improvements to secure LEED certification for many other company work sites; the increased use of hybrid and biodiesel vehicles; support for community environmental projects; and enhanced tools and programs to help customers use energy more efficiently.

PECO’s efforts are a component of Exelon 2020: A Low-Carbon Roadmap, the comprehensive environmental plan of PECO’s parent company. Exelon 2020 sets the goal of reducing, offsetting or displacing more than 15 million metric tons of greenhouse gas emissions per year by 2020. This is more than the company’s 2001 carbon footprint and is equivalent to taking nearly 3 million cars off American roads and highways.

PECO completed the solar credit purchase through a competitive Request for Proposal (RFP) process launched in October 2009. The RFP process was overseen by independent monitor Navigant Consulting, and approved by the Pennsylvania Public Utility Commission (PUC).

For more information visit www.peco.com/AEPS.

Based in Philadelphia, PECO is an electric and natural gas utility subsidiary of Exelon Corporation (NYSE: EXC). PECO serves 1.6 million electric and 486,000 natural gas customers in southeastern Pennsylvania and employs about 2,400 people in the region. PECO delivered 84.3 billion cubic feet of natural gas and 38.1 billion kilowatt-hours of electricity in 2009. Founded in 1881, PECO is one of the Greater Philadelphia Region’s most active corporate citizens, providing leadership, volunteer and financial support to numerous arts and culture, education, environmental, economic development and community programs and organizations.

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Under the direction of the Commonwealth Financing Authority (CFA), the Alternative and Clean Energy Program supplies loans and grants used for the development of clean energy projects in Pennsylvania. The program is administered by the Pennsylvania Department of Community and Economic Development in conjunction with the Department of Environmental Protection.

Highlights of the program are:

Eligible Applicants

• A corporation, partnership, sole proprietorship, limited liability Company, non-profit, or other commercial entity approved by the commonwealth financing authority.
• A non-profit corporation or association whose purpose is the enhancement of economic conditions in their community.
• A municipality, county, or school district.

Eligible Projects

• Solar projects, including facilities to generate, distribute, or store solar energy, as well as manufacturing or assembly facilities for solar panels or other equipment. Solar photovoltaic and solar thermal technologies are eligible.
• The development or construction of facilities used for the research and development of technologies related to solar energy.

Matching Funds Requirement

• Eligible applicants must provide evidence of commitment of matching funds on the project. The amount of the matching investment must be at least $1 for $1 of program funds awarded by the CFA.

Funds are distributed in three ways (loans, grants, or guarantees) .

Grant (Matching Funds To Help Facilitate Project)

• The maximum grant amount for a solar energy project shall not exceed one million dollars or $2.25 per watt, whichever is less. The CFA will consider projects over one million dollars if the project significantly impacts their goal to increase solar energy generation in Pennsylvania.
• The maximum grant for a solar research and development facility or a solar thermal project shall not exceed one million dollars.

Loan (Borrow Money to be Paid Back at Agreed Interest Rate)

• The maximum loan amount for a solar energy generation or distribution project shall not exceed $5 million or $2.25 per watt, whichever is less. In calculating the $2.25 per watt cost, CFA will not include the cost of any energy storage equipment. The CFA will consider loan requests over $5 million for projects that will significantly impact the Authority’s goal to increase the amount of solar energy generated in the Commonwealth.

• Loans will be repaid over a period not to exceed 10 years for equipment and 15 years for real estate.

• The interest rate for the loan will be fixed at the time of approval of the loan. The current interest rates are posted on www.newpa.com

Guarantee (Acts as a Loan Guarantee to Obtain Financing)

• The guarantee will be in the form of a letter of credit.

• Projects applying for the guarantee must invest a minimum of 10% in equity as part of the project financing.

• The term of the guarantee will not be more than 5 years.

• The amount of the guarantee will not exceed $30 million.

For all terms and requirements please refer to alternative energy funding sight:
Click Here.

The Pennsylvania Sunshine Program was originated to offer rebates as incentives for the installation of solar energy systems. The program was authorized in July 2008, by the Pennsylvania legislature and began accepting applications in May 2009, under the direction of the Department of Environmental Protection (DEP). The program will provide $100 million in rebates for residential and small business solar electric (solar photovoltaic) and solar hot water (solar thermal) installations. Rebates are set up on a declining scale as goals are met in installations. Rebates will only cover up to 35% of system installation charges. Residential Solar Photovoltaic Rebates Step No. Megawatts (MW) in Step Rebate Amount ($/Watt) 1 10 $2.25 2 10 $1.75 3 10 $1.25 4 10 $0.75

Small Business Solar Photovoltaic Rebates

Residential and Small Business Solar Thermal Rebates

Information Sourced From: www.state.pa.us

Highlighted requirements for the Pennsylvania Sunshine Solar Rebate Program:

Residential:
• Must be a Pennsylvania resident.
• Own the home and use it as primary residence (no vacation homes or investment real estate properties).
• Households are permitted only one photovoltaic and one solar thermal rebate.

Small Business
• Must be for-profit entity.
• Located within Pennsylvania.
• Have no more than 100 full-time employees.
• Small businesses can receive multiple rebates but the projects must be completed before they submit any another applications.

Both resident and small business applications must be submitted through a qualified installer on behalf of the applicant.

Please refer to this page on the Pennsylvania Department of Environmental Protection site for more requirements and a list of qualified installers: Click Here To Learn More.

Electricity rates in Pennsylvania could soon be on the rise. Businesses, federal agencies, non-profit organizations, and residents could soon experience an increase in their electric bills. The increase in price stems from the deregulation of the Pennsylvania electricity markets.

In the 1990s Pennsylvania lawmakers moved from a regionally monopolized electricity market to a competitive electricity market. Pennsylvania consumers were paying about 15% more for electricity than the national average, so the decision to embrace a competitive electricity market was easy to make. Legislators restructured electricity generation to promote more competition. However to achieve the transition from a regional electricity market to competitive electricity market, legislators had to institute rate caps to protect from unpredictable price fluctuations and implement a “stranded costs” provision for electricity providers to pay for former infrastructure investments. “In return for the loss of their monopoly status, utilities were allowed to collect a surcharge above the price of electricity, otherwise known as stranded costs. Rate caps already have expired for six utilities statewide, and the transition period will end for all state utilities in 2011—ending the rate caps and the collection of stranded costs.” 4/9/2009, Pennlive.com, “Electricity Deregulation is a Win for Pennsylvania” –Elizabeth Bryan. As rate caps and the collection of stranded costs expire the Pennsylvania electricity market could experience unwanted changes during difficult economic times.

Electricity deregulation was established to promote competition and market efficiency. Unfortunately this is not always been the case. In 2001, California experienced the negative repercussions of a deregulated electricity market. California residents were forced to endure volatile electricity prices, while rolling blackouts plagued the state, and electricity could not be supplied during peak hours. For Californians, electricity deregulation equaled disaster.

The expiration of electricity rate caps could bring unwanted price increases to Pennsylvania. Consumers could experience percentage increases in their electric bills as regional rate caps expire. The following map exhibits regional Pennsylvania electricity territories and the electric providers that serve those areas. So far the consequences have been minor with rate cap expirations only affecting 14.1% of the Commonwealth. However from January 2010 – January 2011, rate caps for five major electricity service territories expire and the Pennsylvania electricity market will be completely deregulated.

Image Source: Pennsylvania Utility Choice (www.puc.state.ps.us)

Electricity rate caps for the Duquesne Light Company, PPL Electric Utilities, Inc., West Penn Power Company, Pennsylvania Electric Company, Metropolitan Edison Company, and PECO Energy Company expire between January 2010 – January 2011. This comprises 85.9% of Pennsylvania’s electricity market and could have an impact on electricity prices going forward. Fortunately Pennsylvania has learned from California’s missteps. Lawmakers are forcing utilities to diversify their electricity risk by securing both short- term and long-term contracts. This mixture of contracts could be helpful in mitigating risk, unlike California whose focus was concentrated on short-term contracts only. Regardless of the outcome, the Pennsylvania electricity market is one to monitor in the months and years to come.

Is there a way for Pennsylvanians to protect themselves from the upcoming deregulated electricity markets and future price uncertainty? The answer is yes. Pennsylvanians’ best solution is to embrace renewable energy. Solar energy can solve Pennsylvania’s electricity deregulation issue and act as hedges to potential higher electricity prices. Solar facilities level the playing field and allow businesses, federal agencies, non-profit organizations, and residents to participate in renewable energy, become less dependent on electric companies, and produce electricity during peak demand times. Parties that install solar facilities have the ability to achieve a fixed or reduced cost of electricity for an extended period of time, generate Alternative Energy Credits (AECs) (which are actively traded on Flett Exchange), and embrace clean energy that is absolutely vital to our environment. Pennsylvania also offers state incentives for affordable green energy. If you are a resident interested in solar click on, Pennsylvania Sunshine Program and for businesses interested in solar, click Pennsylvania Solar Energy Program to learn how to achieve clean energy.

Solar energy is growing in Pennsylvania. The Keystone State is diligently working to make solar power a significant part of its renewable energy policy. Solar developers, installers and integrators are migrating to Pennsylvania to capture a growing market share. The key factors that are contributing to Pennsylvania’s SREC market are:

1. Shortage of Installations – The shortage of solar installations in Pennsylvania could be beneficial to short-term SREC pricing. The lack of solar generators in PA could keep SREC prices buoyant as qualified buyers need to procure SRECs to satisfy Pennsylvania’s Alternative Energy Portfolio Standard (AEPS). This underlying bid could push SREC prices higher if the buyers are forced to pay Alternative Compliance Penalty (ACP). The cap for PA SRECs is 200% of the average market value for SRECs. With Pennsylvania SRECs trading a weighted market value of $297 in October on GATS, this could translate to $594 cap by the end of the energy year.

2. House Bill 80 and Senate Bill 92 – Can establish Pennsylvania as a leader in renewable energy and attract businesses that are environmentally conscious and support the state’s economy. These bills attempt to:

• Raise the amount of solar generated electricity sold in Pennsylvania from 0.5% to 3% by 2026. This amount of solar energy will power approximately 438,000 homes;
• Increase the amount of electricity sold in Pennsylvania from Tier I clean energy sources, such as wind, from 8 percent in the current statute to 20 percent in 2026 and;
• Make enough clean energy to power 2.1 million Pennsylvania homes by 2026;
• Extend the timeline for the Alternative Energy Portfolio Standards (AEPS) Act to 2026 and strengthen Pennsylvania’s competitive position by sending a strong, long-term market signal for new investment.
• Solar energy can also benefit Pennsylvania’s economy. The Solar Energy Industries Association (SEIA) estimates that the Advanced Energy Portfolio (AEP) will support over 14,000 jobs in the solar industry, with at least one third by Pennsylvania residents.
  Source: http://www.PennFuture.org

3. PECO Request for Proposal – PECO is making a concerted effort to promote solar and make projects feasible in Pennsylvania. In October of 2009, the company issued a 6 Megawatt Solar Request for Proposal (RFP) and may enter into fixed agreements if the solar project and prices are right. PECO is committed to reducing, offsetting and displacing harmful emissions and supporting Pennsylvania’s Alternative Energy Portfolio Standards (AEPS). This RFP will total 80,000 solar alternative energy credits or 8,000 credits per year spanning a 10 year lifetime.

Pennsylvania has the opportunity to implement a competent renewable energy policy. Renewable energy can reduce the Pennsylvania’s addiction to brown power, upgrade electric infrastructure, create jobs and decrease harmful emissions. Progressing thinking and wise actions can steer the state in the right direction and make renewable energy a reality.