Wednesday, February 8, 2012

A Letter to Senator Alex Padilla

Hello Senator Padilla

Congratulations on SB 836. I am writing to request that you submit legislation to broaden the reporting requirements of SB 836. When the utilities assess a power plant they do a Benefit-to-cost ratio analysis. Two things included on the cost side are Integration Costs and Transmission Costs. Transmission and integration costs can be high - the 2 billion dollar Sunrise Powerlink Transmission project is a good example. I fear we may be overlooking these costs. I suggest future RPS cost reports include more information on Integration costs ($/kWh) and Transmission costs ($/kWh) to go along with the existing information on Average Costs of Contracts Approved.

I wholeheartedly support expanding solar power in California. I believe that despite the best intentions of solar advocates and legislators our current support policies are poorly constructed and in many cases counter-productive. Germany is approaching $2/Watt installed costs for home sized solar systems - this is less than half the average installed costs in California. In cloudy Germany solar power costs about 15 cents/kWh. If sunny California could install solar for $2/Watt we'd have solar power for about 10 cents/kwh.

If homeowners and business owners could produce electricity for 10 cents/kwh there would be no need for solar subsidies. California would have a self-sustaining solar market that employed tens of thousands of people all across the state - electricians, roofers, salesmen etc. That would be great. Question is, how do we get to $2/Watt? I don't know the whole answer but I'm confident these RPS driven PPA deals are not helping us move in the right direction.

I believe our current solar support policies are throwing money in the wrong directions. If we more fully detail how much money is being spent we have more information to make wiser decisions in the future. If you have any questions I'd be happy to provide additional information.


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