The Position of a Rising Sun

by Margaret Farrell

Pennsylvania is in a peculiar spot for renewable energy. While the state is a leader in national coal production and nuclear power, members of the Alternative Energy Portfolio Standard still aim to sharply increase solar generation by 2020. While Pennsylvania could be on the upswing for implementing renewable resources, other states are facing issues that come further down the road.

The western United States used to be dotted with goldmines, but its huge area and sun exposure now make it a goldmine for something else: solar power. However, a rush of residential solar installation is accompanied by a conflict between consumers who want to save money and utility companies who want to keep profits up. In this consumer-corporate controversy, the state of the environment may be tossed around until a consensus is reached, depending on a variety of factors.

In the past few years, utility companies in Arizona, California, Nevada, Texas and others have been increasingly turning their attention to self-generation customers—residents who install solar equipment. These residents reduce their energy costs by installing their own equipment, usually solar panels, and producing a portion of their own energy. To individuals living in these states, self-generation seems promising.

According to “50 States of Solar,” a report by North Carolina State’s Clean Energy Technology Center, the last twenty years have seen a dramatic decrease in the costs of solar generation—good news for consumers who want to save money. Salt River Project (SRP), one of Arizona’s largest utility companies, describes this process on their website: “When self-generation customers produce more energy than they can use, they sell the extra to SRP. When their home is using more energy than their panels can produce (cloudy days, nighttime, several energy-intensive appliances running at once), they buy power from SRP.”

That sounds like a pretty good deal. As demonstrated by a July 2015 initiative from the Obama administration that sought to increase solar access for all Americans, the White House would seem to agree as well. However, the effect of installing your own housetop solar panels is more complicated than the promising statistics and federal encouragement.

As you might expect, utility companies are in the business of making money, just like every other company in the market. When self-generation costs a company too much, it needs a business plan to counteract the loss of profit. These corporations face fixed costs of installation and maintenance, usually offset by charging customers a particular rate of watt-hour fee. This is where the real conflict of self-generation comes up. When consumers are self-generating and actually selling excess energy back to SRP, the fixed costs are not covered, and SRP loses money. SRP responds by charging extra for self-generation. This translates to an increase in monthly charge for those customers who were previously saving not only money, but natural resources as well.

So what does this mean for the planet? The rate increases are in direct opposition to solar power implementation. Articles from Clean Technica and Seeking Alpha (the former possibly having a bias, but the latter being a site for investment news) predict the collapse of solar equipment providers. The capitalistic resistance to feasible, affordable and renewable energy exemplifies the complexity of environmental issues.

Barring the intricacies of scientific unanimity, public recognition and political support of environmental crises like energy deficiency and climate change, the United States still faces an obstacle of whether or not to implement a plan given our recognition of corporate profitability. The effect is this: utility companies are marginalizing renewable resources and replacing them with their own major fuel sources, such as coal, due to profit favorability. According to their Fact Sheets, SRP’s major generating facilities operate mainly on coal (as well as some oil, natural gas and nuclear plants). SRP is not alone here—coal fuels 41 percent of electricity generation worldwide. This is a major step backward in addressing our environmental deterioration.

The Environmental Protection Agency (EPA) has been warning utility companies of coal use and subsequent carbon emissions since the early 1990s. Electrical plants use the most coal fuel out of any economic sector, with 31 percent of national coal usage dedicated for the generation of electricity. Likewise, carbon emissions have a huge impact on the local climate, which has a powerful and well-documented cascading effect on the entire biosphere.

Based on past and current research, climate change is known to disrupt ecosystems, forcing certain species to migrate to more accommodating climates, disturbing finely synchronized interactions within communities and raising extinction risks for climate-sensitive species. It also reaches human health and fundamental aspects of society by supporting the spread of dangerous pathogens and parasites, contributing to air pollution and ozone layer damage, causing extreme weather events and upsetting crucial agricultural patterns.

The declining cost of solar equipment installation and the large sun-exposed areas in the western United States presents a huge opportunity to reduce coal-generated electricity demand. However, this will not be in the best interest of SRP and other utilities that depend on selling their own coal-produced electricity. It might not be surprising, then, that countries with the most successful implementation of renewable energy have fundamentally different economic systems than the United States.

Germany hit a record in June 2014 when 50 percent of its electricity came from solar energy and 78 percent from renewable sources overall. Sara Thompson of TriplePundit reminds readers that this number can fluctuate even within a year, but these statistics do say something meaningful about the way Germany handles renewable energy. GIZ, a German initiative for international sustainable development, published a report relating Germany’s social market economy to its success in renewable resources. The nation’s attention to social issues on par with economic concerns leads to prioritization of renewable energy in a much more powerful way.

Beyond the mere controversial aspects of the issue, this case serves as a reminder that science is part of a complex web of interests. Even a scientifically feasible solution is only a part of a greater decision—intimate involvement with economic policy and the general public creates a lot of conflicting forces. In the wake of these forces, these decisions can come down to a tradeoff between fulfilling our ambitions of capitalism and valuing the earth that we so dearly call our home.