Edison's rooftop solar project powers up

COMMENT: The "consumer activists" critical of this program are not critical of this program. Their criticism is of who is expected to pay for it. Their argument is that Edison, a for-profit utility corporation, should be footing the capital bill, not expecting its ratepayers to pay the cost. But won't all costs ultimately be recouped from ratepayers?

Edison estimates power from the rooftops project will cost 27 cents a kilowatt hour, compared with an average of 8 cents a kilowatt hour from conventional generation.

Solar panels atop ProLogis’ warehouse in Fontana can power about 1,300 homes. The building is the first of 150 that Edison hopes to outfit with panels. (Gina Ferazzi / Los Angeles Times)

The utility's ratepayer-financed plan to outfit 150 buildings with the panels is cheered by business owners but criticized by consumer activists.

By Marla Dickerson
LA Times
December 2, 2008

Southern California Edison on Monday unveiled its newest power plant: 33,700 solar panels atop a warehouse in Fontana that will feed green energy directly into the grid.

It's the first piece of what the utility says could become the largest rooftop solar installation in the world, a swath of photovoltaic panels spanning two square miles.

The 600,000-square-foot warehouse rooftop, owned by logistics firm ProLogis Inc., is the first of 150 commercial buildings that Edison is looking to outfit with solar panels over the next five years. Collectively, solar panels on all those roofs would provide 250 megawatts of electricity, enough by Edison's reckoning to power more than 160,000 homes when the sun is shining.

Gov. Arnold Schwarzenegger was on hand to flip a mock switch on the 2-megawatt Fontana system, which cost $10 million and can light about 1,300 homes.

"I am a fanatic about renewable energy, and I have been trying to push the power companies . . . to create more," said Schwarzenegger, who urged Edison to move even faster on its proposed plan.

If approved by state regulators, Edison's photovoltaic project would be the largest ever attempted by a U.S. utility; 250 megawatts roughly equals the capacity of all the solar panels manufactured in the United States last year.

The massive size reflects the pressure California's investor-owned power companies are under to meet state mandates requiring them to boost the use of clean energy. It also underscores an evolution in solar financing. Rather than pay for their own panels, companies such as ProLogis are increasingly leasing out their roofs to utilities or striking long-term power contracts with third parties, which own, install and maintain the panels.

The approach is a hit with business owners who are finding their roofs to be unexpectedly valuable real estate. Urban solar is also popular with environmentalists because it can be linked to existing transmission lines and it transforms barren industrial space into platforms for clean power.

"This is exactly what all the energy companies should be doing," said Terry Weiner, conservation coordinator for the San Diego-based Desert Protective Council. She said the solution to global warming "is right there on the roof."

But not everyone is enamored of Edison's plan. The Rosemead-based utility, a subsidiary of Edison International, wants its customers to pick up the nearly $1-billion tab for the proposed 150-roof project.

Consumer activists object. They say Edison should be looking to cheaper sources of renewable power, such as large solar and wind farms and geothermal plants. They contend that Edison International shareholders, not utility ratepayers, should finance the company's huge bet on photovoltaic rooftop solar, one of the most expensive forms of clean energy.

Edison used so-called thin-film panels on its first rooftop project. Supplied by Tempe, Ariz.-based First Solar Inc., that technology is significantly cheaper than traditional silicon-based solar cells. Still, Edison estimates that electricity from the Fontana facility costs about 27 cents a kilowatt hour, compared with an average of 8 cents a kilowatt hour from conventional generation.

"This is not the most cost-effective renewable they could invest in," said Sepideh Khosrowjah, policy advisor for the Division of Ratepayer Advocates of the California Public Utilities Commission. The independent advocacy operation has asked the commission to reject the ratepayer-financed plan. Others fear that Edison would drive up the cost of solar panels by gobbling a limited supply and that the utility would have an unfair advantage over private-sector solar providers, which don't have a captive group of ratepayers to fund their operations.

"This is a solar monopoly that will eliminate its competition," said Michael Boyd, president of the nonprofit Californians for Renewable Energy Inc., in a filing with utility regulators.

Edison executives said their entry into the market would help to lower solar panel prices for everyone because of economies of scale. The company's big orders would help manufacturers improve designs, increase efficiency and ultimately cut prices, said Ted Craver, chief executive of Edison International.

Edison is complementing, not competing, he said, with the private-sector firms that are thriving under California's existing Million Solar Roofs Initiative. That program provides hefty state incentives to homeowners and businesses that install systems less than 1 megawatt in size.

Craver said Edison's photovoltaic project aimed to install systems ranging from 1 megawatt to 2 megawatts on commercial rooftops.

"It fills a gap," Craver said.

California law requires Edison, PG&E Corp.'s Pacific Gas & Electric Co. and Sempra Energy's San Diego Gas & Electric Co. to procure at least 20% of their electricity from renewable sources by 2010. Schwarzenegger wants to boost that minimum to 33% by 2020. Edison is currently at 16%.

Edison already is the nation's largest purchaser of solar power with 354 megawatts under contract. Much of that comes from large-scale solar projects located in remote desert areas, which take years to permit and build.

Craver said Edison wanted to add urban rooftop solar to the mix because it can be rolled out rapidly, getting more clean megawatts online sooner. The Fontana project was completed in a few months.

Edison on Monday announced its second rooftop project atop a 458,000-square-foot industrial building in Chino that is slated for completion in early 2009. Craver said it would probably be Edison's last if the state Public Utilities Commission didn't approve its proposal.

Dickerson is a Times staff writer.

marla.dickerson@latimes.com