Solar incentives threaten local ownership

Minneapolis, Minn.—(May 28, 2008). Large, remote concentrating solar power systems are the new darlings of the solar industry. Some observers now see centralized, not decentralized solar as the future. But a new report by the Institute for Local Self-Reliance reveals that the economic advantage of centralized solar and absentee owned solar arrays rests on federal tax incentives that discriminate against locally owned, decentralized solar arrays.

John Farrell, the report's author and a strong voice in the energy community, calls for Congress to change federal tax incentives to give equal benefits to residential solar arrays, instead of favoring commercial and centralized projects.

"Decentralized solar arrays avoid the cost and hassle of building new high voltage transmission lines", says Farrell. "They also enable local ownership, which should be a goal of public policy."

Concentrating solar power plants work more like conventional power plants than solar photovoltaic panels. They use large arrays of mirrors to focus sunlight for heat, using the heat to create steam and generate electricity. These plants, mostly built in the deserts of the American Southwest, must send their power over long-distance transmission lines and are much larger than the rooftop solar panels that were previously the dominant form of solar power production.

The size of concentrating solar plants precludes local ownership, a benefit that renewable energy policy must factor in. "Ownership converts citizens into energy producers, which in turn gives them a personal stake in expanding the use of renewable energy," notes Farrell. "It also encourages them to maximize energy efficiency, because the greater the efficiency the more independent they become, perhaps even becoming a net exporter of electricity."

The full report, Concentrating Solar and Decentralized Power: Government Incentives Hinder Local Ownership, is available online at http://www.newrules.org/.

For more information, or to arrange an interview with John Farrell, please contact Brooke Gullikson.

About ILSR and the New Rules Project: Since 1974, ILSR has worked with citizen groups, governments and private businesses in developing practices that extract the maximum value from local resources. A program of ILSR, the New Rules Project was designed to build community by supporting humanly scaled politics and economics.