TVA’s Solar Balance Limits Have Riled Some Providers

By Bill Dries

The Tennessee Valley Authority has approved more than 250 renewable energy projects for the year 2013 across the multi-state region it covers.

But some solar providers in Tennessee are chafing at the limits TVA has set as it attempts to balance large solar farm installations with more smaller home rooftop solar installations.

Some solar providers are chafing at limits TVA has set as it attempts to balance large solar farm installations with more smaller home rooftop solar installations. (Lance Murphey)

It buys power from both sources with a premium paid for energy from the residential rooftops.

Memphis Light, Gas and Water Division is the authority’s largest customer and solar installations in the Memphis area are dominated by the large solar installation at Agricenter International and the solar farm in rural West Tennessee along Interstate 40.

“We’ve actually got a balance that we are looking for,” said Chris Stanley, spokesman for TVA. “TVA overall is looking to balance our portfolio and move into cleaner energy sources. We are looking at natural gas. We’ve had a lot of hydro this year thanks to some rains earlier in the year. … We’re looking to just change the balance so we are running cleaner by 2020.”

The mix includes nuclear power as well as wind.

But the mix of solar rooftops and farms has been an issue as TVA’s concerns have included sustaining an industry built around jobs installing the residential rooftops. For that balance TVA has two programs with a total of 60 megawatts of capacity that local utilities sell to the authority, which the authority then pays for.

The Renewable Standard program has a 50-megawatt capacity and is for large solar farms like Agricenter and the West Tennessee Solar Farm.

“Those are very, very large programs and we need those and those are paid out at market rates,” Stanley said. “That’s our least expensive solar power.”

The Green Power Providers program has a 10-megawatt capacity and it is the program for residential rooftops or smaller solar installations that generate up to 50 kilowatts each. It also comes with a 180-day deadline to get the panels on the roof and generate solar energy.

“If your project doesn’t go online, then we take a look at putting some of that wattage back out,” Stanley said, adding 75 to 80 percent of the projects in that program are completed on time.

That solar power is also more expensive for TVA, which buys it at market rate plus a premium rate of 8 cents. The premium above market rate goes directly from TVA to the providers that sell it to a local utility.

For the 2013 slate of projects, TVA has decided to reopen applications for 2.5 megawatts in the Green Power program.

The Tennessee chapter of the Solar Energy Industry Association is urging TVA directors to drop the system of caps based on the calendar year in both programs.

Steve Johnson, the president of LightWave Solar, the provider that has an office in Memphis, estimated the 2.5 megawatts is enough capacity to last about a day.

The association had been hoping for 5 megawatts to be back on the market as what it termed “a stopgap measure to prevent workforce erosion and business impacts in the short term.”

“Consumer demand for solar energy has grown faster than TVA’s ability to adjust, therefore leaving the market underserved, restricting the investment of private capital and creating unnecessary uncertainty for businesses,” said Gil Hough, president of the Tennessee chapter in calling for a “fair and market driven” approach to solar energy development.

But there are market pressures TVA is taking into account that are also factors for those in the solar energy industry.