Pennsylvania is predicted to be the fourth highest state to utilize solar energy by the end of the year.
David Michener, president and co-founder of Sun to Sun LLC, a Chadds Ford-based company that designs and installs solar systems, spoke at the "I Think I've Got a Solar Asset ... Now What?" SEDA-Council of Government seminar July 8 about the factors to consider before investing in solar power.
California has the highest amount of solar power projects, with New Jersey following. If Michener's predictions are true, Pennsylvania has to overcome several obstacles to reach fourth place.
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The Loyalsock Township municipal building is equipped with solar panels, which township supervisors say will save taxpayers $291,654 over the course of 30 years, after an initial 10-year payback period.
From 2009 to 2010, renewable energy in Pennsylvania became very strong, according to Keevin Larson, president of K.C. Larson, but has suffered since then. In Pennsylvania, electricity suppliers are required to secure a portion of their electricity from solar generators. Solar Renewable Energy Certificates, or SRECS, are generated for every mega-watt hour of solar energy created. The certificates can then be put on the market where electricity companies can purchase them, and the generator receives the money.
Larson, who runs a contracting business that also does renewable energy projects, noticed a decrease in solar energy projects recently, but the interest in the projects still exists.
One of the reasons the interest in renewable energy fell is because when interest was high, electricity companies purchased most of the certificates they needed. Since the supply outweighed the demand, the price of certificates decreased. As of Thursday, SREC prices in Pennsylvania were $55, compared to $300 almost a year ago, according to Flett Exchange, a website that tracks the prices.
Michener said in New Jersey, the price is $650 for a certificate. Another reason Pennsylvania's price is so low is because people can sell and buy the certificates outside of the state. In New Jersey, they can only be bought and sold inside of the state, which helps stabilize the price.
Interest has also dropped because of the payback rate for solar projects. It takes about seven years or more for the investment to start making money.
"It's a long-term investment," Michener said.
One local project in the area is the Loyalsock Township building. Bill Burdett, the township manager, wanted solar arrays on the building after SEDA-COG created a spreadsheet to track the savings in a 30-year period. Out of two different scenarios, the township supervisors decided upon the larger solar array, which will save $291,654 in 30 years, after an almost 10-year payback period.
Even though the market looks bad for Pennsylvania now, Michener sees it improving in the near future.
"People are concerned about the environment," he said. "They're worried about the carbon footprint and they want to reduce foreign oil. They also want to make a great investment."
Michener recommended that people who are seriously considering starting a project do an Internet search or call his company. He said one of his favorite parts of his job is getting to talk to people about their projects.
For those interested in solar-powered projects, Michener suggested only paying for what is needed. Oftentimes, businesses or residents purchase more than they need so they can sell the extra energy to turn a profit.
In a process called net metering, the meter spins forward when using power. When more solar power is generated than what is needed, the meter spins backwards, which sends power to the grid. At the end of the month, the customer is only billed for the net power used.
Burdett is not looking to make money from the generator on the Loyalsock Township building.
"Our goal is to get down to zero dollars," he said. "I think it's realistic."
