Oregon Public Utility Commission treats new approach as a modest pilot project rather than a potential game-changer

COURTESY PACIFIC POWER - This Lakeview, Oregon, solar array was completed in 2012 for Pacific Power, based in Portland.Portland is a hotbed of solar energy enthusiasts — despite our often-overcast skies. Yet more than three-fourths of our residents and many businesses can't take advantage of free energy from the sun.

Portland's grand old trees and other obstructions block solar rays from many rooftops, while others face the wrong direction or can't handle the weight of solar panels. Many senior citizens and lower-income homeowners can't afford the steep start-up costs. And a huge chunk of people are shut out because they live in apartments.

The remedy was supposed to be community solar, required by the landmark Senate Bill 1547 enacted last year that phased out the use of coal power in Oregon.

With community solar, residents could "buy into" solar panels built elsewhere, or "subscribe" to some of the power from them, via projects developed by cities, nonprofits, private companies — even PGE and Pacific Power. As it was pitched, community solar would give an apartment tenant in cloudy Southeast Portland access to free solar rays spilling onto panels elsewhere in Oregon where the sun shines 300 days a year.

Solar saves people and businesses money in the long run, and doesn't pollute the skies or cause global warming. Community solar is being birthed as development costs have plummeted, making it a golden time for an industry with huge promise.

Thinking small

But here's the rub: Community solar guidelines proposed by state utility regulators, now under consideration by the Oregon Public Utility Commission, are designed for a go-slow, modest experiment, rather than a potential breakthrough as sought by solar advocates, including Portland city officials.

"We're concerned that the PUC is thinking too small," says Jaimes Valdez, policy manager for Northwest Sustainable Energy for Economic Development in Portland.

"Many subscribers who live on the cloudy west side of the Cascades should be able to subscribe to projects on the sunnier east side of the state," says Bob Robison, a 350PDX activist who got involved in the issue because his roof in Northeast Portland isn't strong enough to handle solar panels.

But the proposed rules by PUC staff wouldn't allow that in most cases.

Rather, the proposed rules would require PGE customers, who mainly live in the wet and green Willamette Valley, to buy into community solar developments only in PGE service territory. Pacific Power provides more service in dry and sunny parts of the state, but often in "islands" of territory. Under the PUC rules, Pacific Power customers, such as those in a pocket of Northeast Portland, could only buy into community solar projects in "contiguous" service territory, meaning they'd have to be in the same island of territory.

"That's way too restrictive," says Andria Jacob, Portland's senior manager of energy programs and policy.

PGE territory is where the bulk of electricity customers are, while Pacific Power's service area is more in need of economic stimulus potentially derived from solar developments.

PUC rationale

"PUC staff believes that legal, technical and policy considerations necessitate a geographic restriction of projects to participants' respective service territories," says Kandi Young, the agency's new public information officer. "... Community solar should extend no further than a utility's aggregate service territory since it should be, by virtue of its designation, a true community resource," she says.

Valdez argues that Senate Bill 1547 envisioned that solar should be accessible anywhere in the state.

PUC staff also proposed capping the amount of energy produced from community solar at 2.5 percent of each utility's overall energy load, and then reviewing the rules once that's achieved.

That's 93 megawatts in PGE territory and 63 megawatts in Pacific Power territory, which together serve the bulk of Oregon customers. That's slightly more than the 140 megawatts' worth of new solar developments in Oregon last year, according to the Oregon Solar Plan.

PGE and Pacific Power are pushing for the cap to be much lower, only 1 percent of their current load. "We should take measured steps as we try this new and untried approach to increase solar in Oregon," PGE wrote in formal comments about the PUC draft rules.

Portland and other parties say the PUC's proposed rules are too bureaucratic, likely stretching out the time it will take to develop community solar. The PUC staff didn't set any deadlines to complete various steps.

The Citizens Utility Board, which represents residential ratepayers before the PUC, estimates the first community solar project won't be completed for at least two years under the PUC's proposed rules.

Solar advocates worry that time is a-wasting, not just due to the rapidly warming planet, but also the decline of solar subsidies. The state's residential energy tax credit for solar is slated to expire the end of this year, and the federal Investment Tax Credit is slated to ratchet down from 2019 to 2022.

In addition, reducing the number of participants means the costs per participant will be higher, Jacob says.

Some solar advocates fear community solar could suffer the same fate as the last great idea in Oregon solar development, a feed-in tariff modeled after the system that vaulted Germany to world leadership in solar energy. The watered-down Oregon version, known as the Volumetric Incentive Program, was wildly popular with sign-ups, but the PUC limited it to a modest 25 megawatts and then canceled it.

Despite the criticisms and disappointments expressed by solar advocates, many praised the PUC staff for balancing diverse stakeholder interests. PGE and Pacific Power, after all, lose business through this, becoming bill collectors and electric transmission delivery agents.

The PUC didn't receive any comments from groups opposed to community solar, as even the utilities say they want to make it work.

"That's all good news," Jacob says. But she observes that the PUC is "an inherently risk-averse, conservative body," with a mandate to protect consumers and keep cost down, rather than address environmental goals such as preventing climate change.

"It's in the DNA," she says.

The PUC may adopt the rules on June 27.