Sunny Spots for Rent | Green Energy News

May 10, 2009 – Vol.14 No.8

SUNNY SPOTS FOR RENT.
by Bruce Mulliken, Green Energy News

Duke Energy has a solar plan for its customers in North Carolina that’s so simple that it might just catch on nationwide.

The utility company wants to RENT sunny spots – patches of roof or land – to install small grid-connected solar systems. Duke will own and maintain the systems for their expected life spans of 25 years. The utility company will own the solar generated power too.

The rent payment to property owners will be based on the size of the system installed. Together, connected by the grid, the mini solar systems will create a distributed solar power system. Property owners hosting the systems need to do little more than than sign some paperwork, receive a payment each month, and decide how to spend the newfound cash.

The $50 million North Carolina Solar Distributed Generation Program – the first of its kind in the nation – will include the installation of between 100 and 400 micro solar systems and provide enough power for 1300 homes. Duke is looking for eligible roofs and grounds of homes, schools, office buildings, shopping malls, warehouses and industrial plants and is already collecting applications. (According to the program web pages Duke is swamped with requests.)

This program may be better than typical net metering programs where utility companies buy solar power produced on solar system owned by others. Here’s why.

Getting a typical net-metered solar system up and running is not an easy task nor is it a guaranteed money maker, as a rental payment under contract would be. With a net-metered system the property owner – sometimes with help from the local utility, often not – is responsible for the planning, purchase, installation and maintenance of his solar system. In return for constructing the system, the property owner gets a reduction in his monthly utility bill for the amount of solar generated electricity drawn from the system by the grid. The owner gets to use whatever electricity is not sold to the utility. The dollar figure for the power purchased will vary depending on how much the demand there is on the grid and how much power the solar system generates, so weather conditions matter. A cloudy month, with less sun power available, the utility purchase will be less. The utility's electricity purchase can result in a reverse-spinning electric meter.

There are other considerations with net-metered systems as well. Move? You probably won’t take your solar investment with you. (Though it could add to the value of the property when it’s sold.) Maintenance? If it’s owned by you, you’ll keep it clean, and in colder climates, snow free. If it’s damaged, it’s yours to fix. And, you’ll have wade through the complicated financial calculations including initial investment, tax incentives, insurance interest, the projected amount of power produced and pay back period to determine whether the solar system is a viable proposition.

With renting your sunny spot, all of the above is the utility’s problem.

If there are downside to Duke’s Solar Distributed Generation Program it’s that property owners could conceivably earn less in rent, less income taxes, than they would with net-metered solar system. This would be a new source of income and income is taxable of course. A guess is that if this solar business model takes off, the Internal Revenue Service will have to make some rulings.

Given the choice between net-metering and a rent check I’d take the check in the mail and let the utility handle the rest. The rental payments will be a fixed amount and will continue for the length of the contract. (Presumably the contract will be transferrable should the property be sold.) For those who rather have a guaranteed regular payment than an irregular reduction in their utility bill the Duke plan is a winner.

Property owners interested in having their home, business or land considered as a potential solar site can register online. Properties must be located in North Carolina and currently served by Duke Energy. If a rooftop is the selected sunny spot the roofing material has to be five years old or less.

Links:

North Carolina Solar Distributed Generation Program
http://www.duke-energy.com/solar-host

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