KRC proposes community solar plan

HOUGHTON The Copper Country has some of the highest electricity rates in the country, and an increasing number of home and business owners are turning to solar panels to offset the cost of electric bills. But for renters, people whose properties just don’t receive enough sunlight, and folks who can’t afford the cost of a system, solar power has so far been out of reach.

But that may soon be changing, with a group of researchers at Michigan Technological University’s Keweenaw Research Center leading the charge for the Upper Peninsula’s first community solar system, and Houghton County considering backing it.

Community solar, according to KRC Research Engineer Abhilash Kantamneni, is a system where private electric consumers can buy into large solar arrays – or series of solar panels – located off their properties, then receive the same power company credits they would if the panels were located on their own roof.

“It’s good for an individual who wants to support solar, but doesn’t want to go to the trouble of putting up panels, or can’t,” Kantamneni said, noting that consumers could buy just one panel, with an investment of about $1,000 after inverters and installation costs, or invest in several.

Kantamneni said community solar investors get the same 30 percent federal tax rebate on their investment as private solar installers, and there is financing available to help with the investment. He said investors could expect to recoup their investment in about nine years with the credits generated through utilities’ net metering systems.

Net metering pays customers back at the utilities’ own rates for electricity generated, up to the break-even point where a consumer has generated as much as they’ve used in a year, generally buying power in the winter and selling it back in the summer.

KRC’s proposed system, he said, is based on the successful Cherryland Electric Cooperative in Traverse City.

Kantamneni said net metering is relatively straightforward technically, but is currently limited by state law and utilities’ regulations. For now, each array is functionally limited to 20 kilowatts (kW) by laws that let utilities pay back only about half of what they charge for energy produced from larger arrays.

That could be changing, however. Kantamneni said utilities are required by law to produce a certain percentage of their electricity from green sources, giving them incentive to support large-scale solar. He’s had amicable meetings with both the Upper Peninsula Power Company and the Ontonagon County Rural Electrification Association, the two companies that provide power for almost all of the Keweenaw.

Newly elected Ontonagon REA board member Tom List, who recently characterized the utility’s current costs and policies as an “obstacle to economic development and growth,” said he thinks embracing solar can help improve the situation.

List said he doesn’t advocate solar as an alternative to the REA, but hopes the REA “can also be a sponsor of the community solar program.”

“Overall, we can change the model of the REA,” he added.

Legislators are also getting in on the movement. State Rep. Scott Dianda, D-Calumet, has sponsored a series of solar bills in the house. The first would require utilities to pay full credits to arrays of any size, not just those 20 kW or less. The second allows for the creation of microgrids, which would allow groups of consumers to generate electricity independently of utilities. The final bill would create an alternate, higher credit rate for consumers who produce more electricity than they use over the course of a year.

Kantamneni says those bills are exciting, but for now the KRC is moving forward with a proposal it’s working on with Houghton County. That proposal would create two 20 kW systems, one attached to the REA’s grid and one to UPPCO’s. Because the arrays would be metered and receive their utility bill credits at a single property, the county would handle accounting and return credits to individual investors through property tax credits.

That accounting model, he said, would be the first of its kind in the United States.

Kantamneni said he’ll be making a formal presentation to the county Board of Commissioners and the public at the board’s Aug. 12 meeting. He hopes the county, which has been involved in the planning and supportive so far, will approve the plan at their following meeting.

“Once the county approves it we’ll start accepting applications,” he said. “We expect to put panels in before it snows.”

If those arrays sell out quickly, he expects many more systems – or larger ones if the law changes – to follow shortly thereafter.

Kantamneni said anyone with questions or input on the plan can email him at akantamn@mtu.edu.