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An Analysis of the Feed-In Tariff and its Potential for Success in the United States

Permanent Link: http://ufdc.ufl.edu/UFE0041665/00001

Material Information

Title: An Analysis of the Feed-In Tariff and its Potential for Success in the United States
Physical Description: 1 online resource (108 p.)
Language: english
Creator: Finkelman, Adam
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2010

Subjects

Subjects / Keywords: contruction, feed, green, net, photovoltaic, solar, sustainable
Building Construction -- Dissertations, Academic -- UF
Genre: Building Construction thesis, M.S.B.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: All throughout Germany, Spain and other European countries right now a feed-in tariff system is being applied to buildings. This feed-in tariff encourages residential, commercial, and industrial building owners to use renewable energy generation systems (mainly solar) on their buildings. The basic idea behind this system is that a premium is paid by a utility to it's consumers for excess power generated by their solar, wind, or alternative energy system. Feed-in tariffs are used by government as incentive for consumers to adopt newer, cleaner, renewable energy sources such as photovoltaics. This idea has spread rapidly across parts of Germany, Spain, and other parts of Europe and has become a catalyst to get average people to invest in renewable energy. This idea is finally being attempted in the United States, and the first place this is being done is Gainesville, Fl. The program in Gainesville is already sold out up to its cap amount for the next few years. This program has become a major step towards bringing renewable energy generation into many buildings in Gainesville (Farell, 2009). This thesis?s purpose is to analyze the feed-in tariff system, the economics behind it, and to explain if it could be successful in the U.S. Ultimately, proposals and recommendations will be made on the benefits of this program in contrast to current renewable energy policy, and how to best implement such a program. This paper will analyze the benefits and drawbacks that have previously come from feed-in tariffs abroad and could come from a national feed in tariff in the U.S.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Adam Finkelman.
Thesis: Thesis (M.S.B.C.)--University of Florida, 2010.
Local: Adviser: Obonyo, Esther.
Local: Co-adviser: Kibert, Charles J.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2010
System ID: UFE0041665:00001

Permanent Link: http://ufdc.ufl.edu/UFE0041665/00001

Material Information

Title: An Analysis of the Feed-In Tariff and its Potential for Success in the United States
Physical Description: 1 online resource (108 p.)
Language: english
Creator: Finkelman, Adam
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2010

Subjects

Subjects / Keywords: contruction, feed, green, net, photovoltaic, solar, sustainable
Building Construction -- Dissertations, Academic -- UF
Genre: Building Construction thesis, M.S.B.C.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: All throughout Germany, Spain and other European countries right now a feed-in tariff system is being applied to buildings. This feed-in tariff encourages residential, commercial, and industrial building owners to use renewable energy generation systems (mainly solar) on their buildings. The basic idea behind this system is that a premium is paid by a utility to it's consumers for excess power generated by their solar, wind, or alternative energy system. Feed-in tariffs are used by government as incentive for consumers to adopt newer, cleaner, renewable energy sources such as photovoltaics. This idea has spread rapidly across parts of Germany, Spain, and other parts of Europe and has become a catalyst to get average people to invest in renewable energy. This idea is finally being attempted in the United States, and the first place this is being done is Gainesville, Fl. The program in Gainesville is already sold out up to its cap amount for the next few years. This program has become a major step towards bringing renewable energy generation into many buildings in Gainesville (Farell, 2009). This thesis?s purpose is to analyze the feed-in tariff system, the economics behind it, and to explain if it could be successful in the U.S. Ultimately, proposals and recommendations will be made on the benefits of this program in contrast to current renewable energy policy, and how to best implement such a program. This paper will analyze the benefits and drawbacks that have previously come from feed-in tariffs abroad and could come from a national feed in tariff in the U.S.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Adam Finkelman.
Thesis: Thesis (M.S.B.C.)--University of Florida, 2010.
Local: Adviser: Obonyo, Esther.
Local: Co-adviser: Kibert, Charles J.

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2010
System ID: UFE0041665:00001


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1 AN ANALYSIS OF THE FEEDIN TARIFF AND ITS POTENTIAL FOR SUCCESS IN THE UNITED STATES By ADAM FINKELMAN A THESIS PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FO R THE DEGREE OF MASTER OF SCIENCE IN BUILDING CONSTRUCTION UNIVERSITY OF FLORIDA 2010

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2 2010 Adam Finkelman

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3 Writing this thesis would not have been possible without the loving support of my Mom, Dad, Amy, Jason, Grandma, Grandpa, Abuela and Abuelo. Thank you for all of your insp iration and support. I love you.

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4 TABLE OF CONTENTS page LIST OF TABLES ............................................................................................................ 6 LIST OF FIGURES .......................................................................................................... 7 ABSTRACT ..................................................................................................................... 9 CHAPTER 1 INTRODUCTION .................................................................................................... 11 Statement of the Problem ....................................................................................... 11 Aims and Objective of the Study ............................................................................. 14 Why Is This Research Necessary? ......................................................................... 15 Organization ........................................................................................................... 15 2 LITERATURE REVIEW .......................................................................................... 17 Introduction ............................................................................................................. 17 Purpose for Literature Review ................................................................................ 17 Overview of the Solar PV System ........................................................................... 17 The Current Growth of the Solar Market in the U.S. ......................................... 20 The Potential of Solar Technology ................................................................... 22 Overview of the FeedIn Tariff System .................................................................... 24 The Standard Structure for a FeedIn Tariff ............................................................ 26 Case Study: Germanys FeedIn Tariff .................................................................... 29 Case Study: Spains FeedIn Tariff ......................................................................... 36 Case Study: Other FeedIn Tariffs Abroad ............................................................. 40 Africa ................................................................................................................ 40 Asia .................................................................................................................. 40 Australia ........................................................................................................... 41 Europe and the Middle East ............................................................................. 42 South and Central America .............................................................................. 42 North America .................................................................................................. 42 Case Study: Gainesvilles FeedIn Tariff ................................................................. 43 Problems with th e Current U.S. Renewable Energy Policy ..................................... 47 Power Purchase Agreements ........................................................................... 48 Federal and State Tax Credits and Rebates .................................................... 49 Net Metering ..................................................................................................... 50 Comparison of FeedIn Tariffs and Net metering .................................................... 52 FeedIn Tariffs .................................................................................................. 52 Net metering ..................................................................................................... 52 Renewable Portfolio Standard ................................................................................ 53 PURPA ................................................................................................................... 55

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5 3 METHODOLOGY ................................................................................................... 58 Introduction ............................................................................................................. 58 Overview of Methodology ....................................................................................... 58 Design of Life Cycle Cost Analysis of a Solar System in Gainesville, FL ................ 59 Design of a Federal FeedIn Tariff .......................................................................... 65 4 RESULTS AND ANALYSIS .................................................................................... 68 Introduction ............................................................................................................. 68 Life Cycle Cost of a Solar System in Gainesville, FL .............................................. 68 Design of a Federal FeedIn Tariff .......................................................................... 71 5 CONCLUSION ........................................................................................................ 77 Overview of FeedIn Tariff Analysis ........................................................................ 77 Current Status of a Federal FeedIn Tariff .............................................................. 77 Recommendations for Further Research ................................................................ 80 Conclusions on a Federal FeedIn Tariff ................................................................. 81 APPENDIX A FIT SYSTEM RATES AROUND THE WORLD AS OF 2009 .................................. 83 B CALCULATIONS FOR ANNUAL RETURNS FROM NET METERING SYSTEMS IN GAINESVILLE, FL ............................................................................ 86 C CALCULATIONS FOR ANNUAL RETURNS FROM FIT SYSTEMS IN GAINESVILLE, F L .................................................................................................. 89 D LCC COST DATA INFORMATION TAKEN FROM BLCC FOR NET METERING SYSTEMS IN GAINESVILLE, FL ............................................................................ 91 E LCC COST DATA INFORMATION TAKE N FROM BLCC FOR FIT SYSTEMS IN GAINESVILLE, FL .............................................................................................. 97 F ROI CALCULATIONS FOR NET METERING SYSTEMS IN GAINESVILLE, FL 103 G ROI CALCULATIONS FOR FIT SYSTEMS IN GAINESVILLE, FL ....................... 104 LIST OF REFERENCES ............................................................................................. 105 BIOGRAPHICAL SKETCH .......................................................................................... 108

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6 LIST OF TABLES Table page 2 1 Solar energy conversions ................................................................................... 19 2 2 Solar power in perspective ................................................................................. 19 2 5 Gainesville fit rates 20092016 ........................................................................... 44 3 1 Average cost of electricity use in Gainesville ...................................................... 60 3 2 Average cost of electricity with 1kw PV system using Net Metering in Gainesville .......................................................................................................... 62 3 3 Average cost of electricity with 5 kw PV system using Net Metering in Gainesville .......................................................................................................... 62 3 4 Initial cost PV systems using Net Metering in Gainesville .................................. 62 3 5 Average annual electric bill with 1 kw PV systems using FIT in Gainesvi lle ....... 63 3 6 Average annual electric bill with 5 kw PV systems using FIT in Gainesville ....... 64 3 7 Initial cost PV systems using FIT i n Gainesville .................................................. 64 3 8 World samples avg. sunlight hours/day and FIT rates ........................................ 66 4 1 LCC of PV Systems With Net Metering In Gainesvil le ........................................ 68 4 2 ROI of PV systems with Net Metering in Gainesville .......................................... 69 4 3 LCC of PV Systems with FIT in Gainesville ........................................................ 70 4 4 ROI of PV systems with FIT in Gainesville ......................................................... 70 4 5 U.S. sample locations avg. sunlight hours/day and FIT rates ............................. 74 A 1 Current Solar Feedin Tariff Rates by Region..................................................... 83

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7 LIST OF FIGURES Figure page 1 1 Crude oil prices 19702008 ................................................................................ 12 2 1 Photovoltaics ...................................................................................................... 18 2 2 Cumulative installed solar photovoltaic power capacity 20002008 .................... 20 2 3 Annual grid connected PV demand in the U.S. 20002008 ................................ 21 2 4 Global solar irradiance ........................................................................................ 23 2 5 German fit projected digression rates 20062017 ............................................... 28 2 6 Germany solar electricity potential ...................................................................... 30 2 7 Freiburg photovoltaics ........................................................................................ 33 2 8 The home of Rolf Disch ...................................................................................... 34 2 9 Solar valley Germany ......................................................................................... 35 2 10 Spai n solar electric potential ............................................................................... 37 2 12 Solar arrays on Stoneridge apartments in Gainesville, FL .................................. 47 2 13 U.S., Germany and Spain solar potential ........................................................... 48 2 14 Net metering vs. Feedin tariffs .......................................................................... 51 2 15 Map of United States Renewable Portfolio Standards ........................................ 54 3 1 World map showing average annual solar irradiance ......................................... 65 3 2 World map showing 10 sample countries for FIT rate analysis ........................... 66 3 3 Avg sunlight hours/day vs. FIT rates .................................................................. 67 4 1 LCC of PV Systems With Net Metering In Gainesville ........................................ 69 4 2 ROI of PV systems with Net Metering in Gainesville .......................................... 69 4 3 LCC of PV systems with FIT in Gainesville ........................................................ 70 4 4 ROI of PV systems with FIT in Gainesville ......................................................... 71 4 5 Solar map of the U.S. ......................................................................................... 73

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8 4 6 Sample locations from the U.S. .......................................................................... 74 4 7 U.S. sample locations average sunlight hours/day vs. FIT rates ....................... 75

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9 Abstract of Thesis Presented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Master of Science in Building Construction AN ANALYSIS OF THE FEEDIN TARIFF AND ITS POTENTIAL FOR SUCCESS IN THE UNITED STATES By Adam Finkelman May 2010 Chair: Esther Obonyo Co chair: C harles Kibert Major: Building Construction All throughout Germany, Spain and other European countries right now a feedin tariff system is being applied to buildings. This feedin tariff encourages residential, commercial, and industrial building owners to use renewable energy generation systems (mainly solar) on their buildings. The basic idea behind this system is that a premium is paid by a utility to its consumers for excess power generated by their solar, wind, or alternative energy system. Feedin tariffs are used by government as incentive for consumers to adopt newer, cleaner, renewable energy sources such as p hotovoltaics. This idea has spread rapidly across parts of Germany, Spain, and other parts of Europe and has become a catalyst to get average people to invest in renewable energy. This idea is finally being attempted in the United States, and the first place this is being done is Gainesville, FL. The program in Gainesville is already sold out up to its cap amount for the next few years. This program has become a major step towards bringing renewable energy generation into many buildings in Gainesville (Farell, 2009)

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10 The purpose of this thesis is to analyze the feedin tariff system, the economics behind it, and to explain if it could be successful in t he U.S. Ultimately, proposals and recommendations will be made on the benefits of this program in contrast to current renewable energy policy, and how to best implement such a program. This paper will analyze the benefits and drawbacks that hav e previously come from feed in t ariffs abroad and could come from a national feed in tariff in the U.S.

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11 CHAPTER 1 INTRODUCTION Statement of the P roblem Over the last few decades, climate change has evolved into an issue of global concern. The link between human population emissions, concentrations of Greenhouse G ases (GHG) in the atmosphere, and climate changes is well documented. There is an overall broad consensus in both the scientific and political communities that significant reductions in carbon emissions are going to be necessary to limit the climate changes to manageable levels. It is clear that the major contribution to GHG emissions comes from fossil fuel b ased energy related activities (Blunt, 2009) Globally, demand for energy services is strong, and gr owing. The World Energy Outlook 2004 predicts that under a business as usual (BAU) scenario, energy needs through the year 2030 will increase by 60% Fossil fuels will continue to dominate energy use accounting for 85% of world primary demand, renewable energy as a percentage of total energy consumption will remain almost entirely unchanged at approximately 14% (Pablo del Ro, 2006) The pursuit of this BAU path brings with it enormous consequences. Environmentally, carbon dioxide (CO2) emissions are expected to grow by 60% primarily from coal fired power stations and a projected boom in car and truck use in developing countries. From an energy security perspective, the bulk of the oil to be consumed will be sourced from only a handful of countries. Under this BAU path countries are expected to experience even greater energy supply uncertainties and price increases from fossil fuels (Blunt, 2009)

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12 Recent trends in the world energy industry, especially a drastic increase in oil prices in the last few years, have increased the economic risk of relying primarily on imported energy because of the volatility of the world energy market. The human population must find out how to meet these growing energy needs in a more sustainable and environmentally sound manner because the BAU model is clearly unsustainable. Figure 11 Crude oil prices 19702008 (Vedran U ran, 2009) Renewable energy technologies have made tremendous advances in the past 25 years (Lorenz, 2008) Today, they offer significant advantages over conventional fuels for meeting energy needs. The advantages of renewable energy technologies are that they: Utilize locally available resources : the sun, wind, etc. Reduce the need for fossil fuel imports. Enhance energy security by encouraging energy independence. Create local job, revenue, and income opportunities.

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13 Can be sited close to the load requirement s. Contribute to rural and urban social and economic development Are environmentally beneficial Recently renewable energy technologi es have experienced substantial improvements in cost, performance, and reliability, making them more competitive than ever in a range of applications. Led by wind and photovoltaic (PV) technologies, renewable energies represent the fastest growing of all energy industries. The momentum for renewable energy worldwide is strong, and the prospects for these different types of technologies are virtually untapped (Hulkhower, 1992) There are a number of drivers that are spurring market growth in renewable ener gy, most notably, investments in technology research and development, renewable energy supportive policy and regulatory frameworks, energy security issues, environmental and climate change concerns, and local and regional development opportunities that these technologies have to offer. Price spikes and supply concerns over fossil based technologies are further increasing interest and demand for the renewable energy. With the increasing costs and risks associated with the International BAU scenario, the question is no longer can we afford renewables, but can we afford fossil energy. Adding renewable energy to a fossil dominated energy portfolio will reduce generating cost and enhance energy security. The problem then becomes how to provide renewable ener gy services in an affordable and accessible manner (Lorenz, 2008)

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14 Aims and O bjective of the S tudy All throughout Germany, Spain and other European countries right now a FeedIn T ariff (FIT) system is being applied to buildings. This FIT encourages residential, commercial, and industrial building owners to use renewable energy generation systems (mainly solar PV) on their buildings. The basic idea behind this system is that a premium is paid by a utility to it's consumers for power generated by their sol ar, wind, or alternative energy system. FITs are used as an incentive for consumers to adopt newer, cleaner, renewable energy sources such as photovoltaics on wide spread scale very quickly This idea has spread rapidly across parts of Germany, Spain, and other parts of Europe and has become a catalyst to get average people to invest in renewable energy. This European style FIT system is finally being attempted in the United States, and the first place this is being done is Gainesville, FL The program in Gainesville is already sold out up to its cap amount for the next few years (Farell, 2009) The objective of the research contained in this thesis is to analyze the FIT system, the economics behind it, and to show that if it could be successful ly implement ed on the national level in the U.S. This paper will dissect FITs, analyzing their structure and the design t hat makes them successful. There will be reviews of the benefits and drawbacks that hav e come from previous case study examples of FITs abroad and in Gainesville, FL. This paper will also analyze the problems with the current renewable energy policies in the U.S. and the Life Cycle Cost of a PV system connected to a FIT in the U.S. Ultimately, proposals will be made on the benefits of this program in contrast to current renewable energy policy, and how to best design and implement a federal FIT program (Lenardic, 2008)

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1 5 Why Is This Research N ecessary? The U.S. has many problems that can be solved by the implementation of a FIT. Currently the U.S. is suffering from an addiction to fossil fuels, rising energy prices, extreme amounts of GHG emissions, and a downturn in its economy. Using renewable energy can solve these problems by utilizing local renewable resources, reducing the U.S. demand for fossil fuel imports, enhancing U.S. energy security, and creating jobs and revenue for local communities. The best way to cause mass adoption of renewable energy as quickly as possible is through a FIT. For thes e reasons, re search needs to be done on how to succ essfully implement a national FIT in the U.S. (Blunt, 2009) Organization Chapter 2 presents a literature review of solar technology. This review includes an overview solar PV systems analyzing the benefits and disadvantages of the technology. This review will also cover the current status of the solar market globally and in the U.S. and the vast potential solar technology has to offer. This chapter includes an analysis of how the FIT works, the proper structure for a FIT, an analysis of FIT systems in countries abroad and an analysis of a FIT system in the city of Gainesville, FL. Lastly, it review s the current renewable energy policy in the U.S. and the problems with each type of policy. Chapter 3 presents the methodology behind FIT systems. This section w ill show how the information gathered was used to conclude that a federal FIT system could be successfully implemented in the U.S. First, through electrical rate calculations for Gainesville, FL and the use of BLCC computer software a Life Cycle Cost analy sis of solar PV system connected through net metering and through a FITs were formed. Last,

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16 by analyzing current literature on sunlight hours per day vs FIT rates by location conclusions were made on how a FITs rate structure should best be designed. Chapt er 4 presents the results and analysis of the thesis. This chapter uses Life Cycle Cost analysis to display how beneficial the FIT system is in Gainesville, FL. Chapter 4 presents the results and analysis of how a federal FIT system structure could be designed and customized for the U.S. Chapter 5 presents conclusions and recommendations based on all previous chapters. Chapter 5 provides a conclusion of the research, an analysis on current U.S. FIT legislation, and sums up the study performed in this work In this chapter recommendations for future research on FITs will also be made.

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17 CHAPTER 2 LITERATURE REVIEW Introduction This literature review will first cover an overview of the Solar PV system including the current market and future trends for PV syste ms. Next, there will be an explanation of the FIT system and the structure necessary for it to be successfully implemented. This review of the FIT system then will delve into numerous case study examples of FITs from Germany, Spain, other countries abroad, and Gainesville, FL. Lastly, there will be a review of the current U.S. renewable energy policy and the problems within it. P urpose for Literature R eview The review of relevant literature is imperative towards reaching and understanding the conclusions and proposals made by this thesis. The purpose of this literature review is to provide the background to and justification for the proposal for a national FIT in the U.S. By analyzing the current and future solar market it will be clear that it is viable and growing source for renewable energy. The purpose of analyzing the FIT system is to understand the formula for correct implementation of the FIT (Butler, 2006). Through the review of case studies the true benefits of successful and losses of unsuccessful FITs can be realized. Finally, the purpose of reviewing the current U.S. renewable energy policy is to see the flaws with current policy and the benefits that could be realized through a federal FIT system in the U.S (Rolland, 2009). O verview of the S olar P V S ystem A photovoltaic or PV system converts sunlight directly into electricity using cells made of silicon or other conductive material. When sunlight strikes the cells, a chemical reaction occurs, and this results in the release of electricity. PV Cells require protection

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18 from the environment and are usually packaged tightly behind a glass sheet. When more power is required than a single cell can deliver, cells are electrically connected together to form solar panels (Rickerson, 2008) A single solar pan el is enough to power an emergency telephone, but for a house or a power plant the modules must be arranged in multiples as arrays. Due to the growing demand for renewable energy sources, the manufacture of PVs has advanced dramatically in recent years (Bu tler, 2006) (Blunt, 2009) Figure 21 Photovoltaic s ( Butler 2006) Roughly 90% of solar panel energy generating capacity consists of gridtied systems. Grid tied systems send energy generated from the solar panel directly into an electrical grid instead of batteries for storage (Butler, 2006). Such installations may be groundmounted (and sometimes integrated with farming and grazing) or built into the roof or walls of a building, known as Building Integrated Photovoltaics or BIPV for short. Solar PV p ower stations today have capacities ranging from 1060 MW although proposed solar PV power stations will have a capacity of 150 MW or more (Crider, 2010)

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19 To put the electrical load capabilities of solar systems into perspective one must understand how w atts relate to kilowatts, kilowatts relate to megawatts, and how megawatts relate to gigawatts. See the below table: Table 21. Solar energy conversions 1 Gigawatt = 1000 Megawatts 1 Megawatt = 1000 Kilowatts 1 Kilowatt = 1000 Watts To put the above electrical loads into perspective please see the below Table 2 2 listing examples of different energy using items and how much they use : Table 22. Solar power in perspective 55 GW Peak daily electrical power consumption of Great Britain in Nov ember 2008. 4.116 GW Installed capacity of Kendal Power Station, the world's largest coal fired power plant. 2.074 GW Peak power generation of Hoover Dam. 140 MW Average power consumption of a Boeing 747 passenger aircraft 1.5 MW Peak power output of GE's standard wind turbine 40kW 200kW Approximate range of power output of typical automobiles 60 W The power consumption of a typical household incandescent light bulb 14 W The power consumption of a typical household compact fluorescent light bulb Photovoltaic production has been doubling every 2 years, increasing by an average of 48% each year since 2002, making it the worlds fastest growing energy technology. At the end of 2008, the cumulative global PV installations reached roughly 15,200 megawatts or 15.2 gigawatts (Pablo del Ro, 2006) The best way to continue the growth globally of the market for PV systems involves improving the performance, cost, and reliability of all system components. One of the current market leaders in efficient solar energy modules is SunPower, whose

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20 Figure 22 C umulative installed solar photovol taic power capacity 20002008 (L enardic, 2008) solar panels have a conversion ratio of 19.3%. However, a whole range of other companies like HoloSun, Gamma Solar, and Nano Horizons are emerging which are also offering new innovations in photovoltaic modules, with a conversion ratio of around 18%. As of August 26, 2009 a world record efficiency level of 41.6% has been reached (Lenardic, 2008) The Current Growth of the Sola r Market in the U.S The United States is rapidly emerging as one of the worlds leading markets for solar power. The installed costs of PV systems have fallen on average 3.6% per year for the past decade, making solar more affordable by the day. This affordability

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21 Figure 23 Annual gridconnected PV demand in the U.S 20002008 ( K olset, 2009) continues to grow as the price of electricity and other fossil fuels continually rise. As a result of these factors and others, the U.S. PV market grew at an ave rage rate of 71% per year from 20002008, signi % per year (Sampson, 2009) The rapid growth in demand for PV in the U.S has placed them as the 3rd largest global demand center for PV behind only Germany and Spain. However, while demand is beginning to stabilize in places like Germany and Spain, the U.S. market is only beginning to grow With the largest electricity demand in the world, and ample available land for solar development, the U.S. presents an at tractive longterm growth opportunity for developers, installers, and other solar service providers (Miller, 2009)

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22 Local and state governments throughout the U.S. are increasingly considering new policies and incentives to support solar deployment, util ities are beginning to consider solar a valuable component of their portfolios, and technological innovations are increasing the effectiveness and value of solar power (Kolset, 2009) T he Potential of Solar Technology The estimated recoverable energy from solar energy is about 1000 times the present human global energy consumption of 10 TW per year. 10 weeks of solar energy is roughly equivalent to the energy stored in all known reserves of coal, oil, and natural gas on Earth. Solar energy is absorbed at Earths surface at an average rate of 120,000 TW, which is 10,000 times the total global demand for energy. We only need to be 0.1% efficient in converting solar energy to usable energy for sunlight to provide the present world consumption of fuels. Many present photovoltaic devices are only around 10% efficient (Blunt, 2009). If we were be able to put these solar devices on 1% of the area where there is recoverable solar energy, all the worlds energy needs could be met with solar energy alone. The technology to do this exists now (Miller, 2009). If we were able to put photovoltaic devices on 10% of the area where there is recoverable sunlight, in two years enough electricity would be produced to equal all known reserves of coal, oil, and natural gas (Simpson, 2010). For example the solar areas defined by the dark disks in Figure 24 could provide more than the world's total primary energy demand (assuming a conversion efficiency of 8%). That is, all energy currently consumed, including heat, electricity, fos sil fuels, etc., would be produced in the form of electricity by solar cells (Rolland, 2009).

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23 Figure 24 Global solar i rradiance (Blunt, 2009) The colors in the map show the local solar irradiance averaged over three years from 1991 to 1993 (24 hours a day) taking into account the cloud coverage ava ilable from weather satellites (Blunt, 2009). The ultimate objective of t he solar industry is to reduce the worlds dependence on fossil fuels and the dangers of global warming. In order to achieve this obj ective the responsibility for the PV manufacturing supply chain is to deliver the l owest cost per kWh to the user. Unlike many electricity generation technologies, the cost per kWh of solar electricity is not driven by the price of fuel because sunlight is free. The key technical challenge f o r the solar economy of the future is to reduce the costs associated with PV manufacturing and installation through improved process efficiency and automation, materials improvements, and cost reductions that result from economies of

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24 scale, while maintaining or enhancing lifetime energy yields from systems (Vedran Uran, 2009) Overview of the FeedIn Tariff System A FeedIn Tariff (FIT) is a system designed to encourage the adoption of renewable energy sources It usuall y includes three key provisions: guaranteed grid access, longterm contracts for the electricity produced, and purchase prices that are based on the cost of renewable energy generation (Josef Fell, 2009) Under a FIT, an obligation is imposed on regional or national electricity utilities to buy renewable electricity (electricity generated from renewable sources, such as solar power, wind power, wave and tidal power, biomass, hydropower and geothermal power), from all eligible participants. The cost based pr emium prices therefore enable a diversity of projects to be developed, and for investors to obtain a reasonable return on all different types of renewable energy investments. As a result, the rate may differ among various forms of power generation, and for projects of different sizes. In addition to cost based prices, FI Ts typically offer a guaranteed purchase for electricity generated from renewable energy sources within longterm (15 25 year) contracts. These contracts are typically offered in a non dis criminatory way to all interested producers of renewable electricity (Vedran Uran, 2009) As of 2009, FIT policies have been enacted all over the world, including Australia, Austria, Belgium, Brazil, Canada, China, Cyprus, the Czech Republic, Denmark, Esto nia, France, Germany, Greece, Hungary, Iran, Ireland, Israel, Italy, the Republic of Korea, Lithuania, Luxembourg, the Netherlands, Portugal, Singapore, South Africa, Spain, Sweden, Switzerland, and in some parts of the United States (Pablo del Ro, 2006)

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25 While the U.S. lacks a national FIT, some utilities as well as local and state governments have either implemented a FIT or are considering doing so over the next few years. The FLa., which introduced the based feed in tariff in the U.S. in February 2009. Gainesville Regional Utilities (GRU) offers 20year rate contracts at rates as high as $0.32/ kWh. When the program was introduced immediately there was immediate and abundant demand to sign up. The program contains an overall program cap of 4 MW per year, and GRU has recently announced that it has received enough applications to meet the program caps through 2016 (Josef Fell, 2009) FITs have spread around the world because they achieve larger deployment at lower costs than other policy types. The stable, longterm revenues afforded by FITs create a low risk investment environment. S in ce the investment environment is lowrisk the cost of capital required to finance renewables is also reduced, and as a result there is a reduced policy cost (Rolland, 2009) FITs also minimize or eliminate transaction costs such as contract and interconnection negotiations and bid preparations that may prohibit smaller projects from moving forward. In other words, FITs can provide an opportunity for diverse groups of investors, homeowners, and businesses to cost effectively invest in, build, and reap the benefits of renewable energy installations (Hulkhower, 1992) Substantial solar organizations such as the Internat ional Solar Energy Society the European Photov oltaic Industries Association, and Solar Alliance support FITs Although there is an emerging consensus about the benefits of FITs it is important to note that FIT design varies widely from country to country. Today, no two FIT policies

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26 are exactly alike, and it is difficult to generalize about the structure and impact of FIT policies. However in order for all of these FITs to be successful they all must offer support for technology differentiation, generation cost based rates, fair purchase and interconnection requirements, use of fixed price and longterm payments, and the use of predictable inc entive declines (Simpson, 2010) FITs have driven the majority of global PV installations to date as a result of their use in key European markets such as Germany and Spain. The success of the FIT in these countries has inspired others, and now FITs are the most widespread national renewable energy policy in the world. In 2008, the number of national FIT policies had grown to 45. Momentum for FIT policies has continued to grow in 2009, with India, South Africa, and the United Kingdom among the new countries that have announced FITs for solar power (Lenardic, 2008) The Standard Structure for a FeedIn Tariff Since national FITs were successfully enacted in Spain and Germany, its design has steadily evolved as early adopters have revised their existing polici es, and other countries have adapted FITs to their own unique contexts. Today, no two FIT policies are exactly alike, and it is difficult to generalize about the structure and impact of FIT policies, h owever, this diversity of policy design and experience reveals a few key structural elements against which future policy development can be benchmarked (Rickerson, 2008) Some of the key structural elements that are essential for the success of a FIT are: Technology Differentiation. FITs need to be tailored t o target different technologies with specific rates for each

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27 Generation Cost Based Rates. T he FIT rate should reflect the specific generation cost of the renewable energy technology, such as PV, plus a reasonable profit. This ensures that the incentive l evel will be sufficient to drive demand. Accurately set, cost based rates reduce price risk for developers, increase revenue certainty, reduce financing costs, and attract a broader base of investors. Purchase and Interconnection Requirements. FITs are powerful policies not only because they guarantee a known price and reduce revenue risk, but also because they typically require that solar electricity generators must be connected to the grid, and that any electricity fed i nto the grid must be purchased. These must take requirements limit the market power that individual stakeholders or interests might otherwise unduly exercise, and can significantly increase investor security by reducing market and operating risks. Fixed Price Payments. Fixed price payments, especially when paired with longterm, generation cost based payments can significantly lower investment risk and policy cost. LongTerm Payments. Since PV systems have service lives of 25 30 years and beyond, longterm FITs are advantageous for sever al reasons. First, longer term payments allow the generation cost of PV systems to be amortized over a greater number years, enabling lower FIT rates and accelerating the timeline on which the value of PV can be captured as electricity prices rise. Second, longterm payments more closely align with the service lives of PV systems, thereby reducing the risks associated with re contracting after the FIT term ends.

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28 Predictable Declines. There are many different approaches to adjusting and revising FIT rates ov er time Of these options, adjustment schedules that occur after a certain period of time are preferable because they are more transparent and predictable than capacity based declines or frequent review by policy makers. If a company installs a large rooft op solar array this year then it will lock in a rate that is higher than one that waits until 2011. This has two effects: First, it creates an incentive for wouldbe entrepreneurs to get in the game as soon as possible, thereby spurring a rush of investment. Second, it forces the green energy sector to innovate. If they want to stay in business and hold on to their margins, manufacturers have no choice but to continually seek out new efficiencies. Figure 25 G erman fit projec ted digression rates 20062017(R ickerson, 2008) Grid Parity is the point at which the solar technology is equal to or cheaper than normal grid power. The most notable example of predictably declining FIT rates for solar

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29 power is in Germany, where the German solar energy industry proj ects that the rate of decline, embedded in the FITs will bring PV to grid parity between 2012 and 2015 (Vedran Uran, 2009) Case Study: Germanys FeedIn Tariff Germany is the world's top PV installer, accounting for almost half of the global solar power m arket in 2007. Germans installed about 850 megawatts of PV in 2006, 1,300 megawatts of new PV capacity in 2007, 2 GW in 2008, and 2.5 GW in 2009 taking the total to 8.3 GW by end of 2009. As capacity has risen, installed PV system costs have been cut in half between 1997 and 2007. Solar power now meets about 1% of Germany's electricity demand, a share that some market analysts expect could reach 25% by 2050 (Epstein, 2008) In the 1980s and 1990s, when the United States was flush with energy, Germany was st ruggling to meet its demand. One of the solutions the country settled on was the FIT model. Germanys early FIT was named the StrEG and was in place from 1991 to 2000 (Butler, 2006) The StrEG was technologically differentiated, but the payments were retai l electricity rate based, not cost based plus a reasonable profit, which therefore made it insufficient to drive PV investment. Because the retail rates of electricity fluctuated over time, renewable generators had difficulty finding low cost financing. Banks preferred a stable and, more importantly, a predictable revenue stream than the StrEG provided by its emphasis on the retail rate (Sampson, 2009). While the national StrEG did not stimulate the PV market, German municipal utilities in cities such as Hammelburg and Aachen developed their own generation cost based plus a reasonable profit FITs for solar power in 1993, which successfully drove local markets.

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30 Figure 26 G ermany solar electricity potential (R olland, 2009) The practice spread rapidly amon g German municipal utilities and was eventually adopted at the national level with the passage of the revised feedin tariff of 2000, called the EEG. The aim of the policy was to cultivate a broad enough portfolio of

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31 The principles behind the EEG system are the same as those followed by electricity regulators in North America and Europe for much of the 20th Century. In classic electric utility regulation, a power plant is built; the utility then seeks recovery of its expenditure plus a reasonable profit. R egulators determine the reasonableness of the costs incurred and the profit required and award tariffs based on their findings. The EEG follows the same practice except that it determines reasonableness in advance of construction. Through a transparent policy making process, reasonable costs are determined from existing experience and the profit necessary to attract capital in sufficient amounts to reach public policy goals for renewable energy development are found and tariffs subsequently set (Vedran Uran, 2009). Differentiating tariffs in this manner breaks any remaining link between the rates paid for renewable energy and the cost of conventional generation, which renewable resources offset (Rolland, 2009). This is most obvious in the case of solar PV. In the 2004 revision of Germany's EEG, the tariff for residential rooftop solar was raised to 0.57/kWh ($0.75 /kWh). Public policy made a determination that a particular resource was desired, such as solar PV, then the tariff necessary to bring on the amount of the technology desired was determined, and the rate posted and made available to all people interested (Vedran Uran, 2009). This policy has allowed Germany not only to meet but to exceed its renewable energy goals. Initially, a goal was to get 12% of its electricity from renewable sources by 2010 but it passed that milestone 3 years early, and has since reached the 15% mark ( the most rapid growth seen in any country ) By the middle of this century Germany aims to increase its renewable energy share to 50% Germany, which is about as sunny

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32 as Juneau, Alaska, still manages to contain almost half the worlds solar generating capacity. Although it is half the size of Texas, and far less windy, Germany is also competing with the United States for the num ber one spot when it comes to generating capacity for wind power (Vedran Uran, 2009) The main driving for ce behind this boom is local communities and small entrepreneurs. If you travel the country youll see the signs of this everywhere, from the port of Hamburg, where wind turbines are laid out off shore between shipping routes, to villages in the Black Forest, where farmers are ripping out ancient waterwheels and replacing them with modern turbines. In Freiburg, a walled medieval city full of cobbled str eets and Gothic spires, there are roof mounted photovoltaic panels everywhere, from churches and schools to train stations and factories, even the local soccer stadium (Lenardic, 2008) Some residents have also found more creative ways to harvest energy. Among them is local architect Rolf Disch. His home, which looks like an upsidedown rocket, has a billboardsized solar array on the roof and wraparound balconies with liquidfilled railings that double as solar heat collectors (Rolland, 2009) The home a lso rotates to follow the sun which helps it to generate 5 times more electricity than it uses. Disch has also designed solar gas stations and a suburban housing development, where the homes act like mini power stations (Vedran Uran, 2009). What inspires ordinary Germans to invest in renewable energy is that its about as safe as government bonds and brings a better return. Under the German system, renewable energy producers are given longterm, fixed rate contracts, designed to

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33 deliver a profit of 79 % T hese rates make green energy a secure bet for both investors and banks (Hempling, 2010) Figure 27 Freiburg photovoltaic s (H empling, 2010) The new German system also contained predictable falling rates. E very year, the rate paid for new contracts fall s, so a company that installs a large rooftop solar array this year will lock in a rate that is higher than one that waits until 2011. This created an incentive for wouldbe entrepreneurs to get involved as quickly as possible, thereby causing a rush of investment (which helps explain why Germany was able to meet it s renewable energy targets 3 years early). By allowing the rate paid to fall it also forced the green energy sector to innovate. If this sector wanted to stay in business and hold

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34 on to their mar gins, manufacturers had no choice but to continually seek out new efficiencies (Hempling, 2010) Figure 28 The home of Rolf Disch (H empling, 2010) This combination of a fast growing market and rapid innovation has turned Germany into a green industry powerhouse. Germany is the leading destination for green capital, with $14 bil lion invested in 2007 alone. Germany is also a front runner in green job creation with roughly 300,000 people work ing in the nations renewable energy sector today. By 2020 green technology is expected to pass the auto and electrical engineering industries in Germany to become the nations top employer, with

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35 more than 700,000 workers. One of the forces driving this growth is exports. Since Germany has made renewable energy technol ogy so efficient many of the windmills and solar panels that are cropping up from New York to the Texas panhandle are made in Germany (Hempling, 2010) The economic benefits of this green tech nology boom have reached into the poorest corners of the country including former East Germany. The region between Frankfurt Oder and Dresden was once very grim but in recent years, a vibrant green energy c orridor, known as "solar valley has sprung up amid the abandoned coal mines and factories that are there. Thousa nds of workers from the area now are now employed in solar panel factories within the solar valley (Rolland, 2009) Figure 29 Solar valley Germany (R agwitz, 2008) Most importantly, although Germanys economy has been devastated by the downturn in the global economy its green energy sector continues to thrive. In fact,

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36 Ernst & Young recently ranked the nation number one on its index of most attractive markets for renewable energy investment (Ragwitz, 2008). One might expect that a FIT system that allow s countless independent producers to se ll electricity at premium rates wou ld come with a hefty price tag, but that is not the case. Studies have shown that even though Germanstyle FITs encourage the use of relatively expensive forms of renewable energy, s uch as solar power, they produce power more cheaply on a watt for watt basis than other renewable energy policies. The reason they can produce cheaper power is because there is less investment risk, and less risk means investors can get lower interest loans for generating equipment. Renewable energy producers are also willing to accept lower profit margins because the returns are guaranteed. The successful production of green technology in Germany has spread to its neighbors (Epstein, 2008) In some nations where FITs have reached critical mass, there is evidence that they have actually driven down the overall price of electricity (Rickerson, 2008). This may seem counterintuitive, but the price of electricity is often driven by natural gas, a costly and vol atile fuel that is frequently used to meet peak power needs. If you have a large volume of renewable energy you can cut your use of natural gas, bringing prices down across the board (Hempling, 2010) Case Study: Spains FeedIn Tariff Spain is one of the most attractive countries for the development of solar technology as it has more available sunshine than any other European co untry. The Spanish government has committed itself to achieve a target of 12 % of primary energy from renewable energy by 2010 with an installed solar generating capacity of 3000

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37 megawatts Spain is the 4th largest manufacturer in the world of solar power technology and exports 80% of this output to Germany (Rickerson, 2008) Figure 210 Spain solar elect ric potential (R agwitz, 2 008)

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38 After Spain enacted its own version of the FIT, for a brief moment, it was the best solar market in the world. Unlike in cloudy Germany there i s significantly more sunshine in Spain. While the government expected a steady stream of investment into the FIT, it got a flood, accounting for more than 40% of the world's total solar installations in 2008. In other words, in 2008 alone the Spanish government estimated that the country added more than 2 gigawatts worth of new solar power, more than all of t he new installations worldwide in 2007 (Graves, 2006) Spains initial FIT was similar to Germany s but their solar electric rates did not fall gradually over the years. Successful FITs need to have cost based rates that gradually a n d predictably fall over time because the costs of installing and operating solar equipment are expected to eventually reach grid parity (Ragwitz, 2008). In other words the costs need to come down until they are on par with the costs of generating conventional power from sources such as coal and natural gas. Spain s FIT did not successfully incorporate this facet of the German FIT structure and they got into trouble because of it (Graves, 2006) Forced to revise its version of the FIT, Spain became one of the principal causes of a recent downturn in the solar industry. Spains faulty regulations have become an example of how government made renewableenergy programs, poorly conceived, can go awry. In just one year of boom the country committed itself to solar paym ents estimated at $26.4 billion which in turn led to taxpayer backlash and bust (Ragwitz, 2008) Spain is a perfect example of how drastic changes in policy can really hurt a market. The FIT established by Spain in 2007 guaranteed fixed electricity rates of up to

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39 44 euro cents/kwh ($0.59/kwh) to all new solar panel projects plugged into the electrical grid until September 2008 (Kolset, 2009). The photovoltaic market had been cutting its costs rapidly throughout the years, and the Spanish tariff, with its high rates, create d an artificial market. And unlike Germany, Spain had no system built in to reduce tariff rates if its capacity targets were exceeded. There was no ability to for the FIT to react because Spain did not figure out how to make its FIT market responsive (Ragwitz, 2008) While the Spanish government had expected it would not see 400 megawatts of solar capacity in the country until 2010, by the fall of 2007, some 350 megawatts had already been installed. Scrambling, the government upped its target to 1,200 megawatts. But as it became clear the market would overshoot that limit, too, the boom became a frenzy as developers rushed to connect their projects to the grid before September 2008, when the government altered the tariff, dropping rates by 30% The repercu ssions of the tariff revision can still be seen today. The photovoltaic market was overwhelmed with excess panels, reducing prices. Demand for the excess panels began by Italy and France helped, but it did not soak up all the excess supply. Spain's solar i ndustry lost more than 20,000 jobs. Although the FIT was not completely successful in Spain, better structured FITs like the one from Germany can and have been very successful in other countries (Ragwitz, 2008). The Spanish government's revised FIT has set a hard cap of 500 megawatts to be built, most of this as more costly rooftop installations. Revisions to Spains FIT are now made on a quarterly basis. Demand remains high, however, with 2,468 applications

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40 having been received recently. Spain should rem ain a viable solar market, but the whole process could have been much less painful with a bit more foresight (Epstein, 2008) Case Study: Other FeedIn Tariffs Abroad Below is a brief overview of each continent or region with information availabl e on sol ar FIT programs It is important to note that this section focuses on FITs for PV that are most likely to drive PV market development. Other smaller FITs that do not include provisions for PV are not discussed in detail (Ragwitz, 2008) Africa P V development in Africa has historically been concentrated in off grid applications, because of the limited grid infrastructure in many parts of the continent. To date, the number of national policies for gridconnected photovoltaics remains limited. Several countries have established FITs for renewable energy, but none of these have yet implemented specific PV FITs (Ragwitz, 2008) In October, 2009, South Africa announced that it would expand its existing FIT policy to include a rate for PV systems larger than 1 MW i n size, set at 3.94 rand/kWh ($0.48/kWh). This price is expected to decrease significantly in 2010. Several recent studies have also proposed FITs for micro grids in Africa and other parts of the developing world, but none have been implemented to date. As ia During the past 10 years, Asia has installed close t o 20% of global PV capacity. The majority of these installations have been in Japan, which had installed 2 GW between 1999 and 2008, or approximately 15% of the global total. Recent FIT policy developm ent activity in China, India, Japan and Taiwan has set the stage for significant possible PV market growth in the near future (Hempling, 2010)

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41 Although Japan relied on rebates to drive its PV market for many years, it introduced a net metering program for onsite PV generators in November, 2009, and the new government has announced its intent to develop a FIT. In China, announcements of PV projects totaling 12.5 GW of development by 2020 have been made in recent months, but it remains unclear what type of policy will support this development. China recently established national wind FITs and the province of Jiangsu has established PV FITs but no national PV FIT has been published to date. Taiwans government passed FIT legislation on June 12, and the Bureau of Energy released proposed PV rates in September. These rates have not been finalized but the PV rates are scheduled to go into effect in early in 2010. In May 2009, Indias Central Electricity Regulatory Commission initiated a regulatory process to dev elop FITs for a range of renewable energy resources, including PV. The regulatory proceedings are ongoing, but it is clear that the PV rates will be based on generation cost over a 25year contract term. Korea is thus far the only country in Asia to have i nstituted a PV FIT based on generation cost. In 2008, the PV FIT was set at 677 won/kWh ($0.52/kWh) for systems smaller than 30 kW and 711 won/ kWh ($0.54/kWh) for systems larger than 30 kW, with an overall capacity cap of 500 MW by 2011, and an annual cap of 50 MW for 2009. The 2008 tariff supported the development of 276 MW of PV capacity. In 2009, the tariff has been revised to include 5 size categories, lower prices, and a choice between 15 and 20year contract terms. The annual caps for 2010 and 2011 w ill be 70 MW and 80 MW, respectively. In 2012, the FIT is scheduled to phase out in favor of a renewable portfolio standard. Australia Australia has a national renewable electricity target of 20% by 2020, which it currently meets through a system of tradable renewable energy credits. However, e ach of the Australian states and territories is free to develop their own renewable energy policies and several have established FIT policies (Ragwitz, 2008) Queensland, South Australia, and Victoria have each established net metering systems which only credit PV systems for excess generation above and beyond what is consumed onsite. However, there have been proposals for a FIT for PV by 2010. Australian Capital Territory (ACT) has established a 20year gross FIT of AUS $0.5005/kWh (U.S. $ 0.44/kwh) for systems up to 10 kW and AUS $0.4004/kWh (U.S. $0.35/kwh) for systems up to 30 kW.

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42 In November, 2009, New South Wales became the second Australian government to establish a FIT for renewable systems. The 7year tariff o f AUS $0.60/kWh (U.S. $ 0.53/kwh) for PV systems less than 10 kW can be combined with solar rebate program also available from the state. This price is expected to decrease in 2010. Europe and the Middle East Europe as been the center of global photovoltai c market growth during the past 10 years, installing 67% of the 13.7 GW installed globally between 1999 and 2008. This growth has been driven almost exclusively by FIT policies, which have rapidly diffused across the region. To date, at least 18 of the Eur opean Unions 27 member states have adopted FITs The most notable countries of these are Germany, and Spain (Ragwitz, 2008). South and Central America Although some countries in Central and South America have implemented FITs for renewable energy, none have implemented specific FITs for PV to date (Ragwitz, 2008) North America Although some areas of North America, such as California, were early global market leaders, North Americas PV market has been slow to grow when compared to Europe. During the past 10 years, North America only added 800 MW of PV capacity, or approximately 6% of the global total. Canada, Mexico, and the United States have not yet adopted federal PV policies that have driven rapid market growth nationwide to date. Most PV market growth has been driven primarily by targeted state or provincial policy. In both Canada and the U.S., state, provincial, and city governments have begun to adopt FITs (Ragwitz, 2008)

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43 The first generation cost based FIT for PV in North America was introduced in Ontario in 2006. The policy was revised in 2009 and now size differentiated in a manner similar to Germanys FIT, with rates that around CAD 0.802/kWh ($0.78/kwh). In the United States, the State of California passed a limited FIT in 2006 that offers the s ame FIT rate, based on avoided cost, to all renewable generators. This tariff was unsuccessful and has not yet supported the development of new PV generation. In 2009, the State of Vermont and the cities of Gainesville, Florida and San Antonio, Texas each established limited PV FITs based on generation cost. These were set at $0.30/kWh. Although this FIT is capped, it has set a new national precedent for policy development. In 2009, the Hawa ii Public Utilities Commission also announced preliminary rules fo r a forthcoming generation cost based rate, and the State of Oregon passed solar FIT legislati on, with rates to be determined. Gainesville FL was the first city to implement European style FITs. It set a cap of 4 megawatts per solar installation in order to be eligible to participate and offe red a 20year contract that would pay $0. 32 cents per kilowatt hour of electricity produced. San Antonio, TX plans to institute a FIT in 2010. The local municipal utility named CPS Energy will cap its annual solar PV a mount at 4kW and will offer a rate of $0.27/kWh for generation (Ragwitz, 2008) Case Study: Gainesvilles FeedIn Tariff In March of 2009, Gainesville became the first city in the U.S. to introduce European Style FITs Ed Regan, assistant general manager f or strategic planni ng at the city's utility and 30 year veteran of the industry was the leader in implementing the city's FIT. Regan who pushed for FITs in Gainesville recognized that c ountries that have FITs have a much higher percentage of renewable energy at much lower costs largely due to the decreased risks that come from the longterm, set price contracts FITs offer (Epstein, 2008) Gainesville set a cap of 4 megawatts per solar installation in order to be eligible to participate in the FIT. At the t ime the tariff was announced the whole state of Florida

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44 had only 2 megawatts worth of solar installed. The city offered a 20year contract that would pay $0. 32 /kWh of electricity produced. More i mportantly, the amount paid would decrease according to whic h year the equipment is installed and enrolled in the program, so those signing up last year would get a higher payment than those signing up this year, and so on. Making the Gainesville FIT cost based was a wise decision because, ideally, the rate paid to new customers decreases each year, as technology evolves and solar PV energy generation becomes more cost efficient. Although other FIT programs have been implemented in the U.S., the GRU program is the first and only one patterned after those that have s uccessfully encouraged renewable energy generation in Europe. Other poorly designed FITs in the U.S. are based on avoidedcost factors like the purchasing utilitys cost savings, the cost of climate mitigation measures, or the value of negative impacts on health and air quality. The Europeanstyle feedin tariff is based on the estimated generation costs of the renewable energy system, plus a mandated rate of return on investment. In addition to being easier to calculate, this guarantees a profit for Gaines villes renewable energy producers because it takes into account actual costs of production (Epstein, 2008) Table 25. Gainesville fit rates 20092016 (R ickerson, 2008)

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45 Just as Germany quickly rose to prominence in the global solar market, creating gr een jobs and megawatt upon megawatt of solar power, so has Gainesville realized fast rewards. In less than 1 year, GRU doubled the amount of solar capacity that has ever been installed i n the city prior to the FIT. Currently there are 2 solar power plants under construction that will produce 2,400 megawatt hours of solar energy, and a 2MW rooftop system that will be online above the city's largest shopping center by the end of 2010 (Rolland, 2009) The Gainesville FIT program was implemented in March 2009. Less than a month later, GRU had already received proposals for approximately 12 megawatts of solar PV energy (6 times the amount of PV installed statewide) To date, GRU has accepted enough applications to generate sufficient solar PV electricity to meet the programs targets through 2016. GRU states that it will continue to accept and approve applications to fu lfill targets for future years. There are currently 36 solar PV systems already installed in the GRU service area, with a total capacity of 210 kilowatts. The Gainesville FIT program has the potential to attract major new renewable energy investments and provide a vital boost to the local economy. More than 220 companies currently produce, sell or install solar PV products in Florida alone. While the program does not require that solar PV equipment be sourced from or installed by local or in state companies, products and service providers must meet all applicable national and local standards and be licensed to operate in Florida (Epstein, 2008) Sinc e the Gainesville FIT is the first of its kind in the U.S. it is far from a perfect system. Because p reference for local solar companies was not written into the program the FIT may attract solar companies from out of state who aim to capitalize on the

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46 exp ected growth. A lthough the program has stimulated local interest in solar PV installations, some local solar contractors estimate that 78% of the projects in the pipeline for the next few years will be handled by out of town companies, meaning fewer invest ments going into the local solar PV industry and fewer secondary benefits trickling down into the Gainesville community (Gipe, 2009) The FIT program has drawn other criticisms now that implementation has begun. Rhone Resch, president and CEO of the Solar Energy Industries Association believes it was poorly designed. Resch think s the rigor in reviewing applications was not there, that t o many applications were put in place and then accepted by project developers who have never developed projects in the past He believes that the first tier of projects that have received acceptance probably wont ever get constructed. The reason for this belief is that a lack of an application fee resulted in many initial proposals for PV systems that could not be implemented. These proposals overstated their potential system size, or were for buildings that had yet to be constructed. Furthermore, since applicants were not required to show that they had the necessary funds to actually pay for the system, the queue for project proposals filled up very quickly. As a consequence, the participation of homeowners, schools and nonprofit organizations was limited, lowering these sectors chances of benefiting from the program (Miller, 2009) Still, a round Gainesville many new solar projects are popping up. For example Stoneridge apartments has begun installing numerous photovoltaic arrays on the roofs of its buildings (See Picture Below)

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47 Figure 212. Solar arrays on Stoneridge apartments in Gainesville, FL Problems with the Cur rent U.S. Renewable Energy Policy In the U.S. renewable energy policy consists of an uncoordinated and haphazard combination of state and federal incentives. A company or person wanting to install a solar electric system must negotiate a bewildering list of incentives. Each of the incentives has an overhead cost. Having gained sufficient financing, the developer must then engage in lengthy and costly negotiations with the local utility to develop a contract with often costly interconnection requirements (Miller, 2009) As can be seen in Figure 213 the solar potential in the U.S. is quite large. It is a shame that t he complexity of the U.S. system and the lack of a national FIT impedes the growth of solar energy, may well raise its cost, and certainly disc riminates against s mall and locally owned projects interested in pursuing PV technology A FIT would achieve greater renewable energy development, at a lower cost and with greater economic and socia l benefits like local ownership (Sampson, 2009).

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48 Figure 2 13 U.S ., Germany and Spain solar potential (S ampson, 2009) Power Purchase Agreements After winning a bid from a local utility to place your solar energy system on a structure you begin the power purchase agreement negotiation. Some of these power purc hase agreements can take as long as a year. There are deceiving and misleading sections in the power purchase contract you must review and if you dont negotiate them out you risk getting little or no financing. By the time the power purchase contract is n egotiated, the community based developer may be required to renegotiate purchase

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49 agreements with suppliers since so much time has elapsed, this could jeopardize the entire project (Gipe, 2009) There is a need for legislation to simplify the process. Some thing simpler needs to be organized that allows community projects to get financed, move ahead, and not get bogged down in unimportant information and regulation that's involved in large power generation. Power purchase contracts in the U.S. can be very co mplex and sometimes almost a hundred pages in length In Germany a 20 year, all in one FIT contract ensuring a reasonable prof it is only five pages long (Sampson, 2009). Federal and State Tax Credits and Rebates Federal and state tax incentives seemed pr etty bleak in the U.S. until some tax incentives for r enewable energy were added in the Emergency Economic Stabilization Act of 2008. With this bill comes a new 30% tax credit that can be received on residential solar installations and it will last until 2 016. In other words, if you install a solar energy system on your home for $30,000, you can receive $10,000 back in rebates As part of the 2006 Florida Energy Act, the Solar Energy Systems Incentives Program offers Florida statewide rebates for individuals or businesses to purchase solar photovoltaic systems. Solar photovoltaic systems are eligible for a $4/watt rebate, capped at $20,000 for homes and $100,000 for businesses. In Gainesville, FL the local utility also offers a rebate on PV systems of $1.50/Watt capped at $7,500. In other words if you were to get sized for a small to medium 3kW PV system in Gainesville, FL, you can get $12,000 back from the state of Florida, and $4,500 back from the local utility. These Federal State, and Utility rebates ca n allow you to have a decent initial savings, but you are still not profiting off of your investment (Gipe, 2009)

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50 While these incentives broaden the pool of potential investors, they dont thaw the f rozen credit markets, which have made it difficult to get financing for renewable projects. The current system of incentives also does not fix market instability. For example, funding for the Florida State Tax break is only available for a limited time and can run out very soon. Although the state and federal t ax incentives for adding solar p anels seem simple, they are not The complexity of the system results in more difficult and costly renewable electricity generation, and hampers the ability of states and communities to maximize the benefits of their renewabl e energy resources. Federal, State, and Local Utility Tax Incentives and Rebates only discount an initial cost of a solar panel, they do not offer a return on your investment like a FIT. These incentives, although much improved from previous years, are unlikely to spur the kind of small, local production, widespread economic development, and rapid job growth seen from previous FIT (Gipe, 2009) Net Metering In the U.S. as part of the Energy Policy Act of 2005, all public electric utilities were required t o make available upon request net metering to their customers. FITs are similar to net metering, only with a much higher payoff to solar users. Under FITs homeowners can potentially be paid more than 3 times the retail price for electricity fed into the grid. What makes FIT programs so effective and l ikewise separates them from net metering incentives in the U.S., is that money is paid based on the entire production of solar energy by any one system. In other words with FIT s homeowners are paid for every kilowatt hour generated by their energy system and provided to the local grid at a premium price; with net metering customers only receive a rate on the excess electricity generated that was not used by the home. With net metering if there is excess energy

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51 left at the end of the month, than that amount is sold back to the grid at a wholesale price (normally equal to or less than the value a customer would pay for electricity) In essence, the FIT guarantees a return on your investment and a much faster payb ack rate. The picture below illustrates the difference between net metering and FIT for a household with a solar panel, with data in kilowatt hours (kWh) (Sampson, 2009). Figure 214 Net metering vs. Feedin tariffs (S ampson, 2009) The two policies ar e really just accounting measures, because the electr icity from the solar panel will serve the home first in either case. However, they have a very different impact on the building owners decision about the size of the renewable energy facility that will be installed. Under net metering, the owner will probably size the unit to the buildings internal use, because excess power is purchased at low (wholesale) rates. Under a FIT, the producer is paid a premium for every kWh generated and there is often no li mit on the size of the facility that will earn that payment. Since the solar system is an investment the owner will size it to maximize the rate of return (Hempling, 2010)

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52 Comparison of FeedI n Tariffs and Net metering FeedI n Tariffs Measure total elect ricity generation and consumption independently Accumulate both values over time Export = Customer paid for all generation Import = Customer charged for all consumption Entire renewable generation valued at a premium price set by FIT Total consumption figures given Requires two separate meters Net m etering Renewable electricity generation on site is first used in the home Excess renewable electricity exported Measures either imported energy from grid (meter moves forward) or exported energy to the grid (me ter moves backward) at any instant. Accumulates both values separately Export = Customer paid for generation minus instantaneous demand Import = Customer charged for consumption minus instant generation Customer paid for all exports at wholesale price Cust omer charged for all imports There are numerous problems with net m etering. This system discriminates against people who are at home during the day, such as stay at home parents or senior citizens, as they will be consuming proportionally more of their generation. Net m etering doesnt provide financial certainty, as it is difficult to predict excess generation after inhome consumption without a detailed energy audit; even then, circumstances change. The net m etering system doesnt reward system owners for the full value of the clean

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53 electricity they generate, in terms of avoided emissions, network benefits and reduced demand. Lastly, net m etering has a lack of transparency, as it is impossible to determine either the total generation or the total inhome co nsumption via this form of metering. This makes energy auditing very difficult (Sampson, 2009). Currently, n et m etering i s offered in more than 35 s tates. Until recently Floridas net metering policy was scattered. But as of July 1, 2009, all utilities in the Florida, whether investor owned or owned by the municipality now have to credit your solar power dollar for dollar (Hempling, 2010) GRU, the local Gainesville utility, actually pays customers back at $0.12/kW h, slightly more than the cost to purchas e the electricity. Even though this rate is slightly more than the cost, the difference is not significant enough to create a return on your investment within a reasonable amount of time (Miller, 2009) Gainesvilles FIT allows you to have separate electr ic meters for outgoing and incoming power, and you sell your power to the utility at a higher rate than you buy it for. In Gainesville the utility pays $0.32/kWh for solar production, over three times the retail price of electricity (Milton, 2009) Renewable Portfolio Standard A Renewable Portfolio Standard (RPS) is a regulation that requires the increased production of energy from renewable energy sources, such as wind, solar, biomass, and geothermal. The RPS mechanism generally places an obligation on electricity supply companies to produce a specified fraction of their electricit y from renewable energy sources. During the past decade, there has been progress in RPS policy development in the U S at the state level. According to the map below, as of May 2008 there were

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54 currently 26 states with mandatory RPS policies in the U.S., and another 6 states had established nonbinding renewable energy goals. Although it is projected that RPS policies will require the development of over 60 gigawatts of renewable re sources by 2025, this will only account for 15% of projected electri city demand growth in that year (Gipe, 2009) Figure 215 Map of United S tates Renewable Portfolio Standards (H empling, 2010) An RPS provides a timeline for the utilities, but does not push projects forward. A FIT sends a signal to investors; it makes projects happen quickly Moreover, a FIT can be designed to accelerate renewable energy growth, but to do so in a way that achieves economic development or other important social goals, s uch as allowing more energy consu mers to become energy producers. By supporting local ownership and dispersed generation, a FIT can increase the economic benefits and reduce the cost of acquiring more renewable energy. Both

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55 policies can increase the level of renewable electricity generation, but the FIT is a more comprehensive strategy. The RPS is a collection of goals and the FIT system could be just what these states need as a mechanism for achieving the RPS goals (Simpson, 2010) PURPA FITs in the U.S. is not a new idea, i n fact the U.S. tried them once before in the 1970s. During this time period the global economy was experiencing an energy crisis the result of OPEC choking off the worlds oil supply. In an attempt to ward off future oil shocks, Congress passed the Public Utility Regulatory Policies Act of 1978 (PURPA), which required power companies to buy electricity from small renewable generators. Faced with predictions that the price of oil would rise to $100 a barrel, Congress acted to reduce dependence on foreign oil, to promote alternative energy sources, energy efficiency, and to diversify the electric power industry (Graves, 2006) One of the most important effects of the law was to create a market for power from nonutility Qualifying F acilit ies (QFs). B efore PURPA, only utilities could own and operate electric generating plants. Now PURPA was requiring utilities to buy power from QFs that could produce cleaner power with less pollution (Simpson, 2010). This power also helped reduce demand dur ing peak hours and it cost less than what it would have cost for the utility to generate the power themselves. Since this power helped the utility avoid such issues, it was bought from the QF at an "avoided cost to be determined by each state energy regul ator. PURPA enforced that i f the purchasing power from one QF was no more expensive than the available alternatives, a utility must accept the additional capacity from the QF at the avoided cost rate (Graves, 2006)

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56 The problem with the avoided costs w as t hat the state energy regulators who set them relied on various forecast models to estimate future fossil fuel prices and electric prices. Since, in the 1980s, it was not uncommon to see predictions that crude oil prices would reach more than $100 per barrel by the year 2000 predictions were severely overestimated. The actual price turned out to be less than $30 per barrel in 2000 and during the entire decade of the 1990s, crude oil prices were less than $25 per barrel. As a result of overestimated avoided c osts, electric utilities and their retail ratepayers were stuck with sometimes copious amounts of high priced generation (Simpson, 2010). The issue of avoidedcost pricing does not arise with new FIT systems because they set their rates as cost based. The new FIT systems like PURPA have f ixed price payments, and longterm contracts but their rate of electricity is cost based and therefore follows predictable declines with the declining cost of renewable technology. These declining rates make the FIT more e ffective than PURPA because they spur the U.S. green energy sector to innovate (Simpson, 2010) If renewable energy businesses would want to stay in business and hold on to their margins under a FIT than manufacturers would have no choice but to continuall y seek out new efficiencies. Accurately set, the FIT cost based rates reduce price risk for developers, increase revenue certainty, reduce financing costs, and attract a broader base of investors (Rolland, 2009) PURPA is the only existing U.S. federal la w that requires competition in the utility industry and the only law that encourages renewables. PURPA is no longer much help for renewable energy in the U.S. since current ly avoidedcosts rates are very low. Technically, PURPA only calls for renewable energy if it is cost competitive with

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57 conventional polluting resources and right now renewable energy generation is not cost competitive However, m any of the benefits of renewables are not calculated or weighted fairly in the price of renewable energy such as clean air, or lower carbon emissions, but PURPA makes no provision for including these. Moreover, as the guaranteed prices of PURPA contracts signed in the 1980s expire, many renewable power generators are going out of business (Simpson, 2010) A s long as fossil fuel price forecasts are low, there will be very little development of new renewable energy through PURPA. What is needed is a new law that accounts for the full range of benefits of renewable energy, like reduced pollution, less global warming, domestic and local economic development, and reduced dependence on foreign energy sources. The challenge, therefore, is to develop a FIT mechanism that achieves the broader policy goals associated with renewable developm ent at the least possible cost (Gra ves, 2006).

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58 CHAPTER 3 METHODOLOGY Introduction The most effective way to ensure sustained growth for the PV industry in the U.S. is the development of a FIT because it encourages predictable demand, stability private investments that are transparent and streamlined to pr omote fair and honest outcomes, and it has open and accessible policies that enable distributed energy production (Rickerson, 2008) In the methodology section of this thesis the economic benefit of FITs is further proven through explanati ons of the methods used to create Life Cycle Cos ts (LCCs) of different PV systems connected to FITs. In this chapter there will also be descriptions of how a rate structure was designed for a FIT in the U.S. Overview of Methodology This thesis analyzed the market for solar technology, the FIT system, case studies of FIT implementation, and the problems within current U.S. renewable energy policy. The main sources for information on this report were literature from Journals, Magazines, White Papers, and Case Studies. This method of research was used because these sources provided the most recent and relevant information on the subject. Since the subject of FITs is fairly new and still developing, the best and most relevant information is recent literature. Most of the methodology used to gain conclusions in this thesis was therefore made through the analysis of this literature. The methodology section will show how the information gathered was used to conclude that a federal FIT system could be successfully im plemented in the U.S. First, the calculation of different electrical rates for PV systems under 25 kW in Gainesville, FL and the methods for using Building Life Cycle Cost (BLCC) computer software will

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59 be shown. This research will later lead to a Life Cycl e Cost (LCC) analysis of PV systems connected through net metering and the FIT over a 20 year period. Last, by analyzing current literature on sunlight hours per day and FIT rates abroad conclusions were made on how a federal FIT in the U.S. could be succe ssfully designed. Design of Life Cycle Cost Analysis of a Solar System in Gainesville, FL Through analysis of current rates for electricity and costs of PV, along with rates provided by net metering and FIT systems in Gainesville, FL, a LCC analysis was able to be created through BLCC computer software. BLCC conducts economic analyses by evaluating the relative cost effectiveness of alternative buildings and buildingrelated systems or components. Typically, BLCC software is used to evaluate alternative des igns that have higher initial costs but lower operatingrelated costs over the project life than the lowest initialcost design. It is especially useful for evaluating the costs and benefits of energy and water conservation and renewable energy projects. Through this program one can use a thorough database of current electrical rates, electricity inflation rates, discount rates and other cost trend data. The BLCC software can then display the LCC of two or more alternative designs to determine which has the lowest LCC and is therefore more economical in the long run (Milton, 2009). In order to get the LCC s much input data had to be found. I n the U.S. an average house consumes electricity at the rate of 1 kW/h, there are about 730 hours in each month, and the average price of a kW hour of electricity is about $.10. After multiplying these numbers together an average monthly electric bill is found to be around $73 for 730 kWh of electricity use. This cost can vary considerably if you have some nonstandard item s like a hot tub or some electrical appliances running continuously. It will also increase significantly in months when running an air conditioning unit or a heater.

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60 The cost of electricity varies widely across the U.S. as well from a low of $.07/kWh in West Virginia to a high of $.24/kWh in Hawaii, so one would need to adjust their rates. For Gainesville, FL we assumed that the electricity rate is the average $0.10/kwh (Miller, 2009). Table 31 Aver age cost of electricity use in G ainesville Cost/kWh Ho ur/Month Cost/Month Cost/Year $ 0.10 730.00 $73.00 $876.00 (Negative Numbers Indicate Costs) For solar panels, the value used for a solar panels generating capacity is 10 watts/sq. ft. This generating capacity and size represents a panel conversion efficienc y of about 12% which is average. This conversion efficiency means that for every kW you need to generate, youd need about 100 sq. ft. of solar panels. If the sun would shine 24 hours a day, you could put up 100 sq. ft. (having the generating ca pacity of 10 watts per square foot or 1000 kW per square foot) of panels and you would have enough to power an average home (since the average home uses 730 kilowatt hours per month). Although this sounds simple enough, as we all know, the sun doesnt shine all the time (Milton, 2009) The sun is only available during the day and the amount of sunshine per day is very dependent on cloud cover, also the length of each day is dependent on the season. These numbers vary across the U.S. from an average of ar ound 3 hours per day in places like Seattl e and Pittsburgh to 5 or 6 hours per day in states like Colorado and California to a high of 7 hours a day in Arizona. Because sunlight hours vary the size of your solar array can vary from around 400 to 800 sq. ft (4 kW to 8 kW) respectively, depending on where you live. In Gainesville, the average sunlight hours per day are 5.27, or 158.1 sun hours per month.

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61 The f irst analysis was how much one could save on a monthly bill through PV systems connected through net metering in Gainesville. The net metering system in Gainesville buys back only your excess electricity at a rate of $0.12/kwh for smaller sized PV systems less than 25kW If you dont have excess generation than you get charged for the difference betwee n your use and generation at the standard rate of $0.10/kwh. Using this information there was a monthly/annual analysis of the costs of 1kW, 2 kW, 3 kW, 4kW, 5kW, 10kW, 15kW, 15kW, 20kW, and 25kW systems connected to net metering systems. All of the LCCs for these systems can be seen in the appendix. The information received from this initial analysis was inputted along with other cost information into the BLCC soft ware to calculate a LCC (Milton, 2009) Below are examples of the initial monthly/annual co st analysis of net metering with a 1kW and 5 kW systems: The owner of a solar system in Gainesville, FL could not only expect benefits from net metering, but also Federal, State, and Utility Tax Credits. The Federal Tax Credit is 30% off the initial system cost, the limited time Florida State Tax Credit is a rebate of $4/watt installed, to not exceed $20,000, and the limited time GRU tax credit is $1.50/watt installed, to not exceed $7500. These rates were applied to the initial costs of each system and inputted into the BLCC computer software to form a LCC model for a net metering system in Gainesville, FL. In Table 34 you can see the calculated initial cost of each PV system tested.

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62 Table 32. Average cost of electricity with 1kw PV system using Net M et ering in G ainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year $ 0.10 1 158.10 $15.81 $189.72 PV Savings/Year Electricity Use Cost/Year Electric Bill Cost/Year $189.72 $876.00 $686.28 (Negative Numbe rs Indicate Costs) Table 33 Average cost of electricity wi th 5 kw PV system using Net M etering in G ainesville Cost/kWh Size of System(kW) Hours of Sunlight needed to meet electricity use/Month PV Savings/Month PV Savings/Year $ 0.10 5 146.00 $73.00 $876.00 PV Savings/Year Electricity Use Cost/Year Hour of Sunlight/Month Used Hours of Sunlight/Month Total Excess Hours of Sunlight/Month $876.00 $876.00 158.10 146.00 12.10 Avoided Cost/kWh Size of System(kW) Total Excess Hours of Sunligh t/Month PV Savings/Month PV Savings/Year $ 0.12 5 12.10 $7.26 $87.12 (Negative Numbers Indicate Costs) Table 34 Initial cost PV syst ems using Net M etering in G ainesville Type 1 kW system 2 kW system 3 kW system 4 kW system 5 kW system Initial Cost $12,000 $20,000 $28,000.00 $36,000 $43,500 Fed Tax Credit 30% $3,600 $6,000 $8,400.00 $10,800 $13,050 Fl Tax Credit $4/watt $4,000 $8,000 $12,000.00 $16,000 $20,000 GRU Tax Credit $1.5/watt $1,500 $3,000 $4,500.00 $6,000 $7,500 Initial Cost after rebates $2,900 $3,000 $3,100.00 $3,200 $2,950

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63 Table 34. Continued. Type 10 kW system 15 kW system 20 kW system 25 kW system Initial Cost $80,000 $120,000 $160,000 $200,000 Fed Tax Credit 30% $24,000 $36,000 $48,000 $60,000 Fl Tax Cre dit $4/watt $20,000 $20,000 $20,000 $20,000 GRU Tax Credit $1.5/watt $7,500 $7,500 $7,500 $7,500 Initial Cost after rebates $28,500 $56,500 $84,500 $112,500 (Negative Numbers Indicate Costs) Lastly, using the same variables and location for net metering systems in Gainesville we calculated the LCC for a FIT connected PV system. There was a monthly/annual analysis of the costs of 1kW, 2 kW, 3 kW, 4kW, 5kW, 10kW, 15kW, 15kW, 20kW, and 25kW systems connected to FIT systems. The Gainesville FIT pays at a rate of $0.32, and unlike net metering, it pays for all generation. The information received from this initial analysis was inputted along with other cost information into the BLCC software to calculate LCC analysis. All of the LCCs for these systems can be seen in the appendix. Below are examples of the initial monthly/annual cost analysis of FI Ts with a 1kW and 5 kW systems. Table 35. Average annual electric bill with 1 kw PV systems using FIT in Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year $ 0.32 1 158.10 $50.59 $607.10 PV Savings/Year Electricity Use Cost/Year Electric Bill Cost/Year $607.10 $876.00 $268.90 (Negative Numbers Indicate Costs)

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64 Table 36 Average annual electric bill with 5 kw PV systems using FIT in G ainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year $ 0.32 5 158.10 $252.96 $3,035.52 PV Savings/Year Electricity Use Cost/Year Electric Bill Profit/Year $3,035.52 $876.00 $2,159.52 (Negative Numbers Indicate Costs) The only tax benefit that could be used along with FITs in Gainesville is the Federal Tax Credit of 30% off the initial system cost. This rebate was applied to the initial costs of each system and inputted into the BLCC computer software to form a LCC model for a FIT connected system in Gainesville, FL. Below you can see the calculated initial cost of each system tested: After calculating all of the benefits and costs for net metering systems and FI T systems, the data was inputted into the BLCC computer software to for a more accurate LCC model for both net metering and FITs over a 20 year period. The LCC models along with ROI analysis of these PV investments can be found in the Results and Analysis section of the thesis (Butler, 2006). Table 37 Initial cost PV systems using FIT in G ainesville Type 1 kW system 2 kW system 3 kW system 4 kW system 5 kW system Initial Cost 12,000 20,000 $28,000.00 36,000 43,500 Fed Tax Credit 30% 3,600 6,000 $ 8,400.00 10,800 13,050 Initial Cost After Rebates 8,400 14,000 $19,600.00 25,200 30,450 Type 10 kW system 15 kW system 20 kW system 25 kW system Initial Cost 80,000 120,000 160,000 200,000 Fed Tax Credit 30% 24,000 36,000 48,000 60,00 0 Initial Cost After Rebates 56,000 84,000 112,000 140,000 (Negative Numbers Indicate Costs)

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65 Design of a Federal FeedIn Tariff By analyzing current recent literature a design for a federal FIT in the U.S. could be made. Through information collected from different journals, newspapers, magazines, white papers, and books, the benefits of a federal FIT was revealed. These sources provided data on the average sunlight hours/day of locations around the world and the average FIT rates in these places. After comparing both sets of data a clear relationship was displayed (Pablo del Ro, 2006). The greater the sunlight hours per day in an area the lower the FIT rate has to be. Therefore, the lower the sunlight hours/day in a location, the higher the FIT r ate has to be for that location. The reason for this relationship is because rates are made in relation to how much sunlight potential there is in the location of the FIT. Depending on the amount of sunlight hours per day electricity providers want to ensu re a controlled and balanced Return On Investment (ROI) for the renewable energy producers. These carefully chosen rates allow solar to be an economic interest to people in all locations, including places with less sunlight, like Germany (Rickerson, 2008). Figure 31 World map showing average annual solar irradiance (Rickerson, 2008)

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66 Figure 32 World map showing 10 sample c ountries for FIT rate analysis Although it is clear that specific locations in the world average more daily sunlight, customize d FIT rate structure s allows for FITs to be successful almost anywhere. This thesis analyzes the sunlight hours and rates for current FIT systems being implemented in the locations highlighted on the map below: In each of the 10 world locations selected in Figure 32 there are FIT systems currently being implemented. Below you can see a chart listing the average daily sunlight hours received in these locations, and each of their 2010 FIT rates: Table 38 World samples avg. sunlight hours/day and FIT rates Location Avg Sunlight Hours/Day 2010 FIT Rates $/kWh 1 Germany 3.6 $0.54 2 Ontario, CAN 3.75 $0.78 3 Switzerland 4.8 $0.60 4 New South Wales, AUS 4.9 $0.54 5 France 5 $0.57 6 Czech Republic 5 $0.66 7 Austria 5.1 $0.63 8 Queensland, AUS 5.8 $0.40 9 Spain 6 $0.46 10 South Africa, AFR 8.2 $0.24

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67 Figure 33 i s a line chart displaying average sunlight hours per day compared to the FIT rates. The black line resembles the general linear direction of the chart. As the average sunlight hours per day increases, the FIT rate decreases. This relationship will be used in the design of a rate structure for a federal FIT in the U.S. in the results and a nalysis section of the thesis. $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 Average Sunlight Hours/Day FIT Rates ($/kWh) FIT Rates Compared To Avg Sunlight Hours / Day ( Linear ( FIT Rates Compared To Avg Sunlight Hours / Day Figure 33. Avg sunlight hours/day vs. FIT rates

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68 CHAPTER 4 RESULTS AND A NALYSIS Introduction The FIT is the most effective way to ensure continued growth for the PV industry because it encourage s predictable demand, stability and it almost always guarantees a return on investment (Rickerson, 2008) This idea is further proven in the results and analysis section of the thesis. First, a LCC model comparing the FIT system to the commonly used net metering system in the U.S. is analyzed in Gainesville, FL. Through careful cost analysis it is proven that FITs allow PV systems to have a lower LCC and a higher ROI than current renewable energy policies. Lastly, a federal FIT is designed and a previously proposed FIT is analyzed. Through this analysis a clear result is shown, that the implementation of FITs in the U.S. would be very beneficial to local economies, and for the growth of renewable energy (Hulkhower, 1992). Life Cycle Cost of a Solar System in Gainesville, FL The initial step in calculating LCC of these systems was to find the LCC of simply paying electricity over 20 years and not purchasing PV. After inputting electricity rate cost data into BLCC we found that the LCC of paying for 20 years of electricity in Gainesville, FL was $15,110. As can be seen by the below LCC analysis of numerous different sized PV systems connected through net metering, the LCC is too high. Since the LCC of all types of PV systems under net metering stays positive it appears that investing in solar through a net metering system is a poor decision. See below: Table 41 LCC of PV Systems With Net M etering In Gainesville Size (kW) 1 2 3 4 5 10 15 20 25 Total LCC $15,270 $12,259 $9,248 $6,237 $2,637 $9,520 $18,852 $28,186 $37,518

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69 -$100,000 -$75,000 -$50,000 -$25,000 $0 $25,000 $50,000 $75,000 $100,000 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Size of Photovoltaic Systems (kW) LCC of PV Systems with Net-Metering In Gainesville Figure 41 LCC of PV Systems With Net Metering In Gainesville With the net metering, there is simply not enough incentive to generate renewable energy through the use of PV. In fact, the LCC of purchasing a 1 kW PV system under net metering is higher than paying for electricity for 20 years alone. One of the main problems with net metering is its low ROI: Tabl e 42 ROI of PV systems with Net Metering i n Gainesville Size (kW) 1 2 3 4 5 10 15 20 25 Total LCC 23.7% 16.6% 9.9% 3.7% 3.0% 4.3% 4.2% 4.1% 4.1% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 0 5 10 15 20 25 Size of Photovoltaic Systems (kW) ROI of PV Systems with Net-Metering In Gainesville Figure 42 ROI of PV systems with NetMetering in G ainesville

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70 Under the FIT system the annual savings are significantly higher than net metering because the FIT pays owners a premium rate of $0.32/kWh. This benefit becomes more and more realized the larger you size your PV system. Below is the LCC of different systems in Gainesville, FL with the FIT: Table 43. LCC of PV Systems with FIT in Gainesville Size (kW) 1 2 3 4 5 10 15 20 25 Total LCC $13,926 $9,570 $5,214 $858 $3,848 $28,077 $49,857 $71,636 $93,416 -$100,000 -$75,000 -$50,000 -$25,000 $0 $25,000 $50,000 $75,000 $100,000 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Size of Photovoltaic Systems (kW) LCC of PV Systems with FITs in Gainesville, Fl Figure 43 LCC of PV systems with FIT in Gainesville As can be seen by the figure above the LCC of PV systems connected through the FIT in Gainesville is significantly less than those connected through net metering Because FITs offer a much higher rate on electricity generated they allow for a larger ROI: Table 44. ROI of PV systems with FIT i n Gainesville Size (kW) 1 2 3 4 5 10 15 20 25 Total LCC 3.2% 2.4% 4.8% 6.2% 7.1% 9.3% 9.8% 10.1% 10.2%

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71 -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 0 5 10 15 20 25 Size of Photovoltaic Systems (kW) ROI of PV Systems with FIT In Gainesville Figure 44 ROI of PV systems with FIT i n Gainesville The reason both systems seem to have similar LCCs with smaller sized PV systems is because the net metering system receives initial cost reductions from state and utility rebates that the FIT system does not receive. Once these rebates have maxed out, roughly around 5kW systems, FITs clearly become a better investment from a LCC perspect ive As can be seen by the LCC analysis for FITs, they can provide an opportunity for diverse groups of investors, homeowners, and businesses to cost effectively invest in, build, and reap the benefits of renewable energy installations (Gipe, 2009) Design of a Federal FeedIn Tariff Could FITs help revive our renewable energy market in the U.S ? Study after study has shown that not only do FITs deliver more renewable energy than other market incenti ves; they do so at a lower cost. If the U.S. adopted a federal FIT it would cost effectively create new green jobs, get capital flowing, and expand the U.S. renewable energy sector better than any current policies. Because of this the FIT system is a

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72 guaranteed solution to many of the problems within the U.S. eco nomy A federal FIT would encourage small, local production, driven not by Wall Street banks but by ordinary entrepreneurs therefore boosting overall efficiency and supporting the growth of local communities (Kolset, 2009) The most successful FITs, such as the one in Germany, have worked because their structure offer s support for: Technology differentiation. Generation cost based rates. F air purchase and i nterconnection requirements. U se of fix ed price. Use of long term payments. T he use of predictable in centive declines. In order for a federal FIT to be successful in the U.S. it must obviously contain these structural elements. But also in order to customize the FIT for the U.S. one must research the average sunlight hours/day of locations around the world in compar ison with the average FIT rates. Through research for these locations a clear relationship is displayed. The greater the sunlight hours per day in an area the lower the FIT rate has to be. Therefore, the lower the sunlight hours/day in a locat ion were, the higher the FIT rate was for that location. The relationship between sunlight hours per day and FIT rates used around the world would need to be the cornerstone of the design for a national FIT in the U.S. as a means for developing differentiated rates for PV across the country.

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73 Figure 4 5 Solar m ap of the U.S. (Rickerson, 2008) In order to customize a rate structure for a U.S. FIT 10 locations were used as the basis for the larger structure. The rates for each location are based off the average sunlight hours per day, and actual or previously proposed FIT legislation for that location. Through looking at the solar map (Figure 45) in comparison with the map of the 10 selected locations below, one can see that a random sample was taken: In each of the 10 chosen locations on the map FIT systems are either currently being implemented (yellow locations) or have previously been proposed (orange locations).

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74 Figure 46 Sample l ocations from the U.S. Below you can see a chart listing the aver age daily sunlight hours received in these locations, and each of their 2010 FIT rates. Table 45 U.S. sample locations avg. sunlight hours/day and FIT r ates Location Avg Sunlight Hours/Day 2010 FIT Rates $/kWh 1 Washington St. 4 $0.72 2 Michigan 4.1 $0.55 3 Vermont 4.2 $0.30 4 New York 4.59 $0.45 5 Gainesville, FL 5.27 $0.32 6 Wisconsin 5.29 $0.25 7 Tennessee 5.38 $0.15 8 San Antonio, TX 5.8 $0.27 9 California 6.3 $0.24 10 New Mexico 6.77 $0.21 Actual FIT Proposed FIT

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75 The below line chart (Figure 47) shows average sunlight hours per day compared to the U.S. FIT rates. The black line resembles the general linear direction of the chart. As the average sunlight hours per day increases, the FIT rate decreases. This downward sloping relationship was used in the same way it has been used for generating successful FITs all around the world. $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 4 4.5 5 5.5 6 6.5 7 Average Sunlight Hours/Day FIT Rates ($/kWh) FIT Rates Compared to Avg Sunlight Hours / Day ( Linear ( FIT Rates Compared to Avg Sunlight Hours / Day Figure 47 U.S. sample locations average sunlight hours/day vs. FIT r ates This rate structure analysis for a FIT for PV systems in the U.S. co uld be used in finding an initial rate for locations all across the U.S Although these initial rates for 2010 are accurate there are other elements that need to be set up in order for a federal FIT to be successful. A federal FIT must also offer support for numerous other renewable technologies besides PV, and with those technologies different rates. The rates established for all forms of renewable energy under the FIT must be generation cost based and therefore must have scheduled declines. A U.S. federa l FIT must be open and allow interconnection to all people who meet the requirements established by the FIT. Lastly, the federal FIT must also allow for fixed price longterm contracts in order to allow the owners a chance to get a return on their investment. The initial rates

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76 established in this thesis are effective starting rates for a national FIT, but these other elements must also be incorporated into the design for it to be completely successful (Butler, 2006)

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77 CHAPTER 5 CONCLUSION Overview of FeedI n Tariff Analysis FITs have driven the majority of global PV installations to date as a result of their use in key European markets such as Germany and Spain. The success of the FIT in these countries has inspired others, and now FITs are the most widespread national renewable energy policy in the world. Structurally the most successful FITs have worked because they offer support for technology differentiation, generation cost based rates, fair purchase and interconnection requirements, use of fixed price and longterm payments, and the use of predictable incentive declines (Simpson, 2010) By using this variety of design variables to incentivize production FIT policies have helped encourage a variety of renewable energy technology types and different sized renewable projects. Current Status of a Federal FeedIn Tariff Congress, is currently clearing away some of the hurdles that lie in the way of launching a successful FIT, like our nations aging, patchwork electric grid, which could make the growth of ren ewable energy difficult to manage, especially if large quantities come online at once. President Obama's American Recovery and Reinvestment Act of 2009 will help solve this problem by providing $11 billion to modernize our energy infrastructure and develop a "smart grid," with advanced sensors and distributed computing capabilities, so it can instantly reroute power to meet demand or avoid system overloads. This should pave the way for a better integration of renewable electricity and, perhaps, open the door to FIT legislation (Farell, 2009) The American Recovery and Reinvestment Act of 2009 also includes more than $70 billion in direct spending and tax credits for clean energy and associated

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78 transportation programs. This policy stimulus combination repres ents the largest federal commitment in U.S. history for renewable energy, advanced transportation, and energy conservation initiatives. As a result of these new initiatives, many more utilities are expected to strengthen their clean energy programs (Miller 2009) Although these investments may one day lead to the advancement of a FIT in the U.S. some people see no reason why a federal FIT cant be implemented now. In May, 2008, Congressman Jay Inslee introduced a national FIT bill before congress, which he refers to as a Renewable Energy P ayment (REP). The bill includes three main design elements that are modeled on the most successful new FIT policies: 1) Guaranteed interconnection to the grid thr ough uniform minimum standards, 2) A mandatory purchase requirement through fixedrate 20year contracts, and 3) Rate recovery through a regionally parti tioned national benefits charge (Farell, 2009) Under the proposed law, the Federal Energy Regulatory Commission (FERC) would set standards for the priority interc onnection and transmission of power from new renewable energy facilities, which include renewable energy facilities 20 MW or less. The FERC and the states would then be required to implement these standards within their own respective areas of jurisdicti on when renewable energy facility owners request interconnection (Miller, 2009) The bill t hen requires all electric utilities in the U.S. to enter into fixedrate, 20year power purchase agreements at the request of any new renewable energy facility owner The FERC would set minimum national REP rates at levels designed to provide for full cost recovery, plus a 10% internal rate of return on investment, for commercialized technologies under good resource conditions. REP rates would be differentiated on the

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79 basis of energy technology, the size of the system, and the year that t he system was placed in service (Lorenz, 2008) The bill would facilitate cost recovery through a private renewab le energy utility organization called RenewCorps. This private renewabl e energy utility would reimburse utilities for the additional cost of their power purchases, plus all costs associated with interconnection and network upgrades needed to accommodate these new facilities. To reimburse utilities, RenewCorps would raise reve nues through a regionally partitioned national system benefits charge on every electric customer in the U.S (Farell, 2009) Given its success in Europe, there are multiple reasons for introducing a national FIT bill in the U. S but Inslees primary motivat ion is to create longterm investment security for the rapid deployment of renewable energy technologies. Inslee believes there is a growing interest in establishing a more stable policy support mechanism for the U.S. renewable energy industry (Farell, 2009) The most successful FITs, such as the one in Germany, have worked because their structure offer s support for: 1. Technology differentiation. 2. Generation cost based rates. 3. F air purchase and i nterconnection requirements. 4. U se of fix ed price. 5. Use of long term payments. 6. T he use of predictable incentive declines. The federal FIT proposed by Inslee offers all of these structural requirements previously discussed. The REP contains the following structural elements: 1. Rates would be differentiated on the basis of energy technology 2. Rates designed to provide for full cost recovery plus a 10% rate of return. 3. Guaranteed interconnection to the grid through uniform minimum standards. 4. A mandatory purchase requirement through fixed rate.

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80 5. Power purchase agreements set at 20years. 6. Rates would be adjusted each year or so that t he system was placed in service By using these design variables that have been proven to be successful in other cases, a federal FIT should be successful in the U.S. A federal FIT system would help enc ourage a variety of renewable energy technology types and different sized renewable projects. Sadly, f rom a political per spective, moving the Inslee bill through the US Congress is not expected to be easy. Although there is rapidly growing tracti on for the bill at the federal level, understanding the bill and its importance is an educational process and it will take time to get policymakers on board (Kolset, 2009). Recommendations f or Further Research F urther research on this subject still needs to be conducted. Research still needs to be done on the many other FITs that have been enacted and are being implemented around the world right now in Australia, Austria, Belgium, Brazil, Canada, China, Cyprus, the Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Iran, Ireland, Israel, Italy, the Republic of Korea, Lithuania, Luxembourg, the Netherlands, Portugal, Singapore, South Africa, Spain, Sweden, Switzerland, and in other parts of the United States Further research also needs to be made analyzing why many states in the U.S. have turned down FIT legislation. There is still much to be understood regarding the barriers preventing a national FIT and what needs to be in place for a national FIT to be instituted most efficiently. From future rese arch more information can be gathered on the exact resources necessary to establish an effective FIT.

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81 Conclusions on a Federal FeedIn Tariff The rapid emergence of federal, s tate and city FIT proposals in the U S represents a significant shift in energy development in the direction of renewables. As fossil fuel prices continue to rise t he U.S. population will continue to demand the benefits that come from the use of renewable energy. These benefits could be further realized by the passing of a federal FI T law (Rickerson, 2008) The best way to get large wide spread deployment of renewable energy in the U.S. would be through FITs because they achieve larger deployment at lower costs than other policy types. The stable, longterm revenues created by FITs al low for a low risk investment environment for the general population In other words, a federal FIT can provide an opportunity for diverse groups of investors, homeowners, and businesses to cost effectively invest in, build, and reap the benefits of renewable energy installations (Lorenz, 2008) A federal FIT would allow for entire communities to benefit through job opportunities, and gr e ater amounts of energy at lower rates. If a federal FIT were implemented it would be the perfect mechanism for states in the U.S. to meet their RPS goals. A federal FIT could be exactly what the U.S. needs to revamp its economy and to achieve it renewable energy goals. Speaking in Oxford, England on the subject of rising energy costs, rising C02 emissions and climate change, former Vice President of the U.S., and Nobel Prize winner, Al Gore reminded his audience of Sir Winston Churchill rallying troops to save civilization during the struggle against Adolph Hitlers Germany: Winston Churchill aroused this nation in heroic fas hion to save civilization in World War Two. We have everything we need except political will, but political will is a renewable resource. We can berate politicians for not doing enough, and compromising too much, and not being bold and addressing these exi stential threats to civilization. But the reason they don't is that the

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82 level of concern among populations has still not risen to cross the threshold to make the political leaders feel they must address it. These words from Al Gore have inspired people acr oss the world to take action and demand renewable energy. The increasing demand for renewable energy is proven through the growth in the PV market, and the expansion of FIT systems to co untries all across the world. The need to quickly adopt renewable ener gy is greater now than ever. A national FIT is financially feasible, environmentally beneficial, increases national energy security, increases job opportunities, and increases investment in local communities A s the demand for renewable energy technologies continues to grow both in the U.S. and around the world it would be in the best interest of the U.S. to consider investing in their own form of FIT policy (Hempling, 2010)

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83 APPENDIX A FIT SYSTEM RATES AROUND THE WORLD AS OF 2009 Table A 1. Current Solar Feedin Tariff Rates by Region

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84 Table A 1. Continued

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85 Table A 1. Continued

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86 APPENDIX B CALCULATIONS FOR ANNUAL RETURNS FROM NET METERING SYSTEMS IN GAINESVILLE, FL Average Annual Electric Bill With 1kW PV System Using Net Metering In Gain esville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.10 1 158.10 $15.81 $189.72 PV Savings/Year Electricity Use Cost/Year Electric Bill Cost/Year $189.72 $876.00 $686.28 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 2kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.10 2 158.10 $31.62 $379.44 PV Savings/Year Electricity Use Cost/Year Electric B ill Cost/Year $379.44 $876.00 $496.56 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 3kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.10 3 158.10 $47.43 $569.16 PV Savings/Year Electricity Use Cost/Year Electric Bill Cost/Year $569.16 $876.00 $306.84 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 4kW PV System Using Net Metering In Gainesville Cost/kWh S ize of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.10 4 158.10 $63.24 $758.88 PV Savings/Year Electricity Use Cost/Year Electric Bill Cost/Year $758.88 $876.00 $117.12 (Negative Numbers Indicate Costs)

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87 Average Annu al Electric Bill With 5kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hours of Sunlight needed meet electricity use/Month PV Savings/Month PV Savings/Year 0.10 5 146.00 $73.00 $876.00 PV Savings/Year Electricity Use Cost/Year Hour of Sunlight/Month Used Hours of Sunlight/Month Total Excess Hours of Sunlight/Month $876.00 $876.00 158.10 146.00 12.10 Avoided Cost/kWh Size of System(kW) Total Excess Hours of Sunlight/Month PV Savings/Month PV Savings/Year 0.12 5 12.10 $ 7.26 $87.12 Average Annual Electric Bill With 10kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hours of Sunlight needed meet electricity use/Month PV Savings/Month PV Savings/Year 0.10 10 73.00 $73.00 $876.00 PV Savings/Yea r Electricity Use Cost/Year Hour of Sunlight/Month Used Hours of Sunlight/Month Total Excess Hours of Sunlight/Month $876.00 $876.00 158.10 73.00 85.10 Avoided Cost/kWh Size of System(kW) Total Excess Hours of Sunlight/Month PV Savings/Month PV Sa vings/Year 0.12 10 85.10 $102.12 $1,225.44 Average Annual Electric Bill With 15kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hours of Sunlight needed meet electricity use/Month PV Savings/Month PV Savings/Year 0.10 15 48.6 7 $73.00 $875.97 PV Savings/Year Electricity Use Cost/Year Hour of Sunlight/Month Used Hours of Sunlight/Month Total Excess Hours of Sunlight/Month $875.97 $876.00 158.10 48.67 109.44 Avoided Cost/kWh Size of System(kW) Total Excess Hours of Sunl ight/Month PV Savings/Month PV Savings/Year 0.12 15 109.44 $196.98 $2,363.80

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88 Average Annual Electric Bill With 20kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hours of Sunlight needed meet electricity use/Month PV Savings/M onth PV Savings/Year 0.10 20 36.50 $73.00 $876.00 PV Savings/Year Electricity Use Cost/Year Hour of Sunlight/Month Used Hours of Sunlight/Month Total Excess Hours of Sunlight/Month $876.00 $876.00 158.10 36.50 121.60 Avoided Cost/kWh Size of Sys tem(kW) Total Excess Hours of Sunlight/Month PV Savings/Month PV Savings/Year 0.12 20 121.60 $291.84 $3,502.08 Average Annual Electric Bill With 25kW PV System Using Net Metering In Gainesville Cost/kWh Size of System(kW) Hours of Sunlight needed meet electricity use/Month PV Savings/Month PV Savings/Year 0.10 25 29.20 $73.00 $876.00 PV Savings/Year Electricity Use Cost/Year Hour of Sunlight/Month Used Hours of Sunlight/Month Total Excess Hours of Sunlight/Month $876.00 $876.00 158.10 29.20 128.90 Avoided Cost/kWh Size of System(kW) Total Excess Hours of Sunlight/Month PV Savings/Month PV Savings/Year 0.12 25 128.90 $386.70 $4,640.40

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89 APPENDIX C CALCULATIONS FOR ANNUAL RETURNS FROM FIT SYSTEMS IN GAINESVILLE, FL Average Annual Electric Bill With 1kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 1 158.10 $50.59 $607.10 PV Savings/Year Electricity Use Cost/Year Electric Bill Cost/Year $607.10 $876.00 $268.90 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 2kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 2 158.10 $101.18 $1,214.21 PV Savings/Year Elect ricity Use Cost/Year Electric Bill Profit/Year $1,214.21 $876.00 $338.21 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 3kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Mo nth PV Savings/Year 0.32 3 158.10 $151.78 $1,821.31 PV Savings/Year Electricity Use Cost/Year Electric Bill Profit/Year $1,821.31 $876.00 $945.31 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 4kW PV System Using FIT In G ainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 4 158.10 $202.37 $2,428.42 PV Savings/Year Electricity Use Cost/Year Electric Bill Profit/Year $2,428.42 $876.00 $1,552.42 (Negative Numbers Indi cate Costs)

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90 Average Annual Electric Bill With 5kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 5 158.10 $252.96 $3,035.52 PV Savings/Year Electricity Use Cost/Year Ele ctric Bill Profit/Year $3,035.52 $876.00 $2,159.52 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 10kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 10 158.10 $505.92 $6,071.04 PV Savings/Year Electricity Use Cost/Year Electric Bill Profit/Year $6,071.04 $876.00 $5,195.04 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 15kW PV System Using FIT In Gainesville Cost/ kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 15 158.10 $758.88 $9,106.56 PV Savings/Year Electricity Use Cost/Year Electric Bill Profit/Year $9,106.56 $876.00 $8,230.56 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 20kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 20 158.10 $1,011.84 $12,142.08 PV Savings/Year Electricity Use Cost/Year Electric Bill Pr ofit/Year $12,142.08 $876.00 $11,266.08 (Negative Numbers Indicate Costs) Average Annual Electric Bill With 25kW PV System Using FIT In Gainesville Cost/kWh Size of System(kW) Hour of Sunlight/Month PV Savings/Month PV Savings/Year 0.32 25 158 .10 $1,264.80 $15,177.60 PV Savings/Year Electricity Use Cost/Year Electric Bill Profit/Year $15,177.60 $876.00 $14,301.60 (Negative Numbers Indicate Costs)

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91 APPENDIX D LCC COST DATA INFORMATION TAKEN FROM BLCC FOR NET METERING SYSTEMS IN GAINESVILLE, FL Project Name: Cost of Electricity in Gainesville LCC Summary Present Value Annual Value Initial Cost $0 $0 Energy Consumption Costs $14,365 $1,079 Energy Demand Costs $0 $0 Energy Utility Rebates $0 $0 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $0 $0 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $15,110 $1,135 Project Name: 1 kW PV System Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $2,900 $218 Energy Consumption Costs $14,365 $1,079 Energy Demand Costs $0 $0 Energy Utility Rebates $3,11 1 $234 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56

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92 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total L ife Cycle Cost $15,270 $1,147 Project Name: 2 kW PV System Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $3,000 $225 Energy Consumption Costs $14,365 $1,079 Energy Demand Costs $0 $0 Energy Utility Rebates $6,222 $468 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ---------------------Total Life Cycle Cost $12,259 $921 Project Name: 3 kW PV System Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $3,100 $233 Energy Consumption Costs $14,365 $1,079

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93 Energy Demand Costs $0 $0 Energy Utility Rebates $9,334 $701 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $9,248 $695 Project Name: 4 kW PV System Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $3,200 $240 E nergy Consumption Costs $14,365 $1,079 Energy Demand Costs $0 $0 Energy Utility Rebates $12,445 $935 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $6,237 $469 Project Name: 5 kW PV System Connected To The Grid Through Net Metering

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94 LCC Summary Present Value Annual Val ue Initial Cost $2,950 $222 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $1,429 $107 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually R ecurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $2,637 $198 Project Name: 10 kW PV System Connected To The Grid Through Net Metering LCC Summary P resent Value Annual Value Initial Cost $28,500 $2,141 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $20,096 $1,510 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Cos ts $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $9,520 $715

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95 Project Name: 15 kW PV System Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $56,500 $4,245 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $38,764 $2,912 Water Usage Costs $0 $0 Water Disposal Costs $0 $ 0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $18,852 $1,416 Project Name: 20 kW PV Sys tem Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $84,500 $6,349 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $57,431 $4,315 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------

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96 Total Life Cycle Cost $28,186 $2,118 Project Name: 25 kW PV System Connected To The Grid Through Net Metering LCC Summary Present Value Annual Value Initial Cost $112,500 $8,453 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $76,098 $5,718 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $37,518 $2,819

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97 APPENDIX E LCC COST DATA INFORMATION TAKEN FROM BLCC FOR FIT SYSTEMS IN GAINESVILLE, FL Project Name: Cost of Electricity in Gainesville LCC Summary Present Value Annual Value Initial Cost $0 $0 Energy Consumpti on Costs $14,365 $1,079 Energy Demand Costs $0 $0 Energy Utility Rebates $0 $0 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $0 $0 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $15,110 $1,135 Project Name: 1 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $8,400 $631 Energy Consumption Costs $14,365 $1,079 Ener gy Demand Costs $0 $0 Energy Utility Rebates $9,956 $748 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0

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98 ---------------------Total Life Cycle Cost $13,926 $1,046 Project Name: 2 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $14,000 $1,052 Energy Consumption Costs $14,365 $1,079 Energy Demand C osts $0 $0 Energy Utility Rebates $19,912 $1,496 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $9,570 $719 Project Name: 3 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $19,600 $1,473 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $15,502 $1,165 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56

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99 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Tota l Life Cycle Cost $5,214 $392 Project Name: 4 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $25,200 $1,893 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $25 ,458 $1,913 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $8 58 $64 Project Name: 5 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $30,450 $2,288 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $35,414 $2,661

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100 Water Us age Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $3,848 $289 Pro ject Name: 10 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $56,000 $4,208 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $85,193 $6,401 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $28,077 $2,110

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101 Project Name: 15 kW PV System Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $84,000 $6,311 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $134,973 $10,141 Water Usage Costs $0 $0 Water Di sposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $49,857 $3,746 Project Name: 20 kW PV Sys tem Connected To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $112,000 $8,415 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $184,752 $13,881 Water Usage Costs $0 $0 Water Disposal Cost s $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $71,636 $5,382

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102 Project Name: 25 kW PV System Connec ted To The Grid Through FIT LCC Summary Present Value Annual Value Initial Cost $140,000 $10,519 Energy Consumption Costs $0 $0 Energy Demand Costs $0 $0 Energy Utility Rebates $234,532 $17,621 Water Usage Costs $0 $0 Water Disposal Costs $0 $0 Annually Recurring OM&R Costs $372 $28 Non Annually Recurring OM&R Costs $744 $56 Replacement Costs $0 $0 Less Remaining Value $0 $0 ----------------------Total Life Cycle Cost $93,416 $7,019

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103 APPENDIX F ROI CALCULATIONS FOR NET METERING SYSTEMS IN GAINESVILLE, FL Initial Costs: Photovoltaic Systems with Net Metering In Gainesville Annual Net Income: Generation Benefit Cost of Electricity Use With Net Metering In Gainesville ROI of Photovoltaic Syste ms with Net Metering In Gainesville Type System (kW) Initial Cost after rebates Type System (kW) Generation Benefit Cost of Electricity Use Type System (kW) ROI 1 $2,900.00 1 $686.28 1 23.7% 2 $3,000.00 2 $496.56 2 16.6% 3 $3,100.00 3 $306.84 3 9.9% 4 $3,200.00 4 $117.12 4 3.7% 5 $2,950.00 5 $87.12 5 3.0% 10 $28,500.00 10 $1,225.44 10 4.3% 15 $56,500.00 15 $2,363.80 15 4.2% 20 $84,500.00 20 $3,502.08 20 4.1% 25 $112,500.00 25 $4,640.40 25 4.1%

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104 APPENDIX G R OI CALCULATIONS FOR FIT SYSTEMS IN GAINESVILLE, FL Initial Costs: Photovoltaic Systems with Feed In Tariffs In Gainesville Annual Net Income: Generation Benefit Cost of Electricity Use With Feed In Tariffs In Gainesville ROI of Photovoltaic Systems with Feed In Tariffs In Gainesville Type System (kW) Initial Cost after rebates Type System (kW) Generation Benefit Cost of Electricity Use Type System (kW) ROI 1 $8,400.00 1 $268.90 1 3.2% 2 $14,000.00 2 $338.21 2 2.4% 3 $19,600.00 3 $945.31 3 4.8% 4 $25,200.00 4 $1,552.42 4 6.2% 5 $30,450.00 5 $2,159.52 5 7.1% 10 $56,000.00 10 $5,195.04 10 9.3% 15 $84,000.00 15 $8,230.56 15 9.8% 20 $112,000.00 20 $11,266.08 20 10.1% 25 $140,000.00 25 $14, 301.60 25 10.2%

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105 LIST OF REFERENCES Blunt, R. (2009). Us and china top solar attractiveness list. Global Solar Journal, 4(56), Retrieved from http://solarfeedintariff.co.uk/tag/spain/ Butler, L. (2006). Comparison of feed in tariff, quota and auction mechanisms to support wind power development. University of Cambridge Papers, 3(45), Retrieved from http://www.dspace.cam.ac.uk/handle/1810/131635 Crider, J. (2010). Florida feedin. RenewableEnergyWorld.com, 1(2), Retrieved from http://www.renewableenergyworld.com/rea/news/article/2010/01/flori dafeedin Epstein, R. (2008). Feedin tariffs: taking net metering to the next level. Solar World, 6(33), Retrieved from http://solar.calfinder.co m/blog/news/feedin tariffs takingnet metering to thenext level/ Farell, J. (2009). Feedin tariffs in America driving the economy with renewable energy policy that works. New Rules Project, 3(2), Retrieved from http://www.newrules.org/sites/newrules.org/files/feed in%20tariffs%20in%20america.pdf Gipe, P. (2009). India's 1.1 billion move to feedin tariffs. RenewableEnergyWorld.com, 2(12), Retrieved fr om http://www.renewableenergyworld.com/rea/news/article/2009/10/indias 1 1 billion moveto feedin tariffs Graves, F. (2006). Purpa: making the sequel better than the original. Edison Electric Periodical, 1(1), Retrieved from http://www.eei.org/whatwedo/PublicPolicyAdvocacy/StateRegulation/ Documents/ purpa.pdf Hempling, S. (2010). Renewable energy prices in statelevel feedin tariffs: federal law constraints and possible solutions. NREL Technical Report, 12(3), Retrieved from http: //www.nrel.gov/docs/fy10osti/47408.pdf Hulkhower, T. (1992). Contracting for nonutility generation*1, *2: the experience of a us utility Science Direct, 2(2), Retrieved from http:/ /www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6VFT45GSC0J 9&_user=2139813&_coverDate=01%2F31%2F1992&_rdoc=1&_fmt=high&_orig= search&_sort=d&_docanchor=&view=c&_searchStrId=1217714722&_rerunOrigin =google&_acct=C000054276&_version=1&_urlVersion=0&_user id=2139813&md 5=c330fa2013b5a50d0eb2c2e0cd559088 Josef Fell, H. (2009). Feedin tariff for renewable energies: an effective stimulus package without new public borrowing. Alliance 90, 15(3), Retrieved from http://www.fitcoalition.com/storage/references/Fell_EEG%20Papier%20engl_fin_ mrz09.pdf

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106 Kolset, T. (2009). A Cautionary tale about feedin tariffs. Center For International Climate and Energy Research, 22(1), Retrieved from http://www.cicero.uio.no/webnews/index_e.aspx?id=11184 Lenardic, D. (2008). PV resources annual review 2008. PVResources.com, 1(1), Retrieved from http://www.pvresources.com/download/AnnualReview_FreeEdition.pdf Lorenz, P. (2008). The Economics of solar power. The McKinsley Quarterly, 34(8), Retrieved from http://www.mckinsey.com/clientservice/ccsi/pdf/economics_of_solar.pdf Milton, E. (2009). Feedin tariffs have earned a role in us energy policy. Pure Energy, 21(4), Retrieved from http://blog.pureenergysolar.com/?tag=gainesvilleflorida Miller, D. (2009). Net metering policies. Renewable Utility Today, 6(9), Retrieved from http://apps3.eere.energy.gov/greenpower/markets/netmetering.shtml Pablo del Ro,. (2006). An Integrated assessment of the feedin tariff system in Spain. Science Direct, 35(2), Retrieved from http://www.sciencedirect.com/science?_ob=GatewayURL&_method=citationSear ch&_uoikey=B6V2W 4JKRTYH1&_origin=SDEM FRHTML&_version=1&md5=888551d3952fa2e86c167e38978a 1e96 Ragwitz, M. (2008). Feedin systems in Germany and Spain: a comparison. Energy Economics Group, 23(11), Retrieved from http://www.bmu.de/files/english/renewable_energy/downloads/application/pdf/lan gfassung_einspeisesysteme_en.pdf Rickerson, W. (2008). Feedin tariffs and renewable energy in the USA a policy update. World Future Council Pages, 3(56), Retrieved from http://www.dora.state.co.us/puc./DocketsDecisions/ DocketFilings/08I 113EG/ExParte08I 113EG/08I 113EG_ExParteCobble Tarpey120408Feed inTariffs.pdf Rolland, M. (February 6, 2009). Commission gives its approval to feedin tariff for solar power. Gainesville Sun, 1719. Sampson, M. (2009). 'net' vs. 'gros s' feedin tariffs what's the difference?. Moreland Energy Foundation Monthly, 9(12), Retrieved from http://mefladvocacy.blogspot.com/2009/12/net vsgross feed in tariffs whats.html Simpson, T. (2010, January 2). Public utility regulatory policy act (purpa) Clean Energy Today, 55(3), Retrieved from http://www.ucsusa.org/clean_energy/solutions/big_picture_solutions/public utility regulatory.html

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107 Vedran Uran,. (2009). A Method for the correction of the feed nex t termin previous term tariff next term price for cogeneration based on a comparison between croatia and eu member states Science Direct, 65(34), Retrieved from http://www.sciencedirect.com/science?_ob=GatewayURL&_method=citationSear ch&_uoikey=B6V2W 4X3DS425&_origin=SDEMFRHTML&_version=1&md5=305bec4b87abdb952c719d8e9762 7e67

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108 BIOGRAPHICAL SKETCH Adam Finkelman graduated from the M.E. Rinker Sr. School of Buil ding Cons truction in May of 2009 with a bachelor s degree in building c onstruction. He finish ed classes at the University of Florida in order to receive a masters degree in building construction, with a c oncentration in sustainable construct ion After his first year of building c onstruction he spent a summer w orking with the Odebrecht Construction Company, which along with the Parsons Construction Company was selected to build the newest terminal at Miami International Airport. Returning to s chool he was asked to serve on the executive board of his frat ernity, ZBT, as the House Chair He spent the next summer taking business and Spanish classes abroad in Madrid, Spain becoming very familiar with the Spanish language because he knew how important it would be in his future career in the construction industry. The following summer he was employed with Plaza Construction in New York and worked on a project to redevelop 16.5 acres of a former food/produce market and the Bronx Mens House of Detention into 1million square feet of retail space, and its required parking. This project was in the process of being awarded LEED Silver Certification. Inspired by work experience in the construction industry, and by the creativity and responsibility which green design entails he came back to the University of Florida motivated to pursue his interes ts further. In his senior year he began taking graduate level Building Construction classes and working on this thesis. He also became a LEED Accredited Professional in February 2009. U pon graduati n g in 2010 with a masters in building construction with a concentration in s ustai nable construction, he plann ed to focus his career in green construction.