Sunshot: Cutting away the red tape from US solar’s ‘exciting growth’

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Cutting away red tape could do

The US Department of Energy’s (DoE) solar cost-cutting programme, Sunshot Initiative, announced an open solicitation at the end of January for US$45 million worth of funds, which will go to technology development programmes ranging from prototype incubation to piloting of production facilities. Sunshot aims to use public funds to benefit the entire industry and the growing low carbon economy – without breaking the bank.

Minh Le, director of Sunshot and Dr Lidijia Sekaric, who heads Sunshot’s ‘Technology to Market’ programme, explain why Sunshot’s targeted funding could make a tangible difference.

Dr. Lidija Sekaric, of Sunshot's
Minh Le:

When PV Tech last spoke to you just over a year ago Minh, the programme was at 50% of its goal. As Sunshot prepares its latest open solicitation and funding, how has it come along since then?

Minh Le: The Sunshot Initiative was launched in 2011 with the goal of making solar cost-competitive with conventional forms of energy generation, without the need for additional incentives. I’m happy to report we’re 70% of the way towards that 2020 goal and we’re not yet halfway into the second initiative.

We’re envisioning a world where we don’t require that need for additional policies, that solar energy can fend for itself and you’re starting to see it more across the United States. The other thing to note is that businesses are choosing solar left and right. Major corporations are choosing solar to power their businesses, not just because it’s good for the environment but because it makes good economic sense for their businesses.

Having said that, there has also been the announcement of some funds for community solar, or shared-ownership, projects. Presumably that is also from the aspect of cost reduction, but how can Sunshot Initiative help in this case?

ML: Yes it is [a cost reduction exercise], because one of our analysis research reports from 2012 stated that about 54% of the cost of small-scale systems turns out to be non-hardware related soft costs. So when we started this initiative, the costs were significantly higher all across the board. Hardware costs have fallen significantly. Non-hardware costs, soft costs, have also fallen significantly, but have not as rapidly and a lot of that cost turns out to be red tape. Because all across America we have got several thousand different jurisdictions and they all have authority to permit and inspect small-scale systems.

Reducing that time, which can take as long as six months to get a permit done and have your system done, will reduce cost because after all, if small businesses want to expand beyond the county or community they currently operate in they actually need to hire more people to understand the paperwork [in that new area] so that kind of barrier for business and reducing some of these soft costs…will do wonders for deployment.

On the soft costs issue, it seems that differences from one jurisdiction to another can make the task of lowering soft costs seem somewhat daunting. It could be property tax laws in one state and fire regulations in another, for example. Is it as challenging as that makes it sound?

ML: Certainly the scale is challenging. What we’re trying to do at the federal level here is make investments, with non-profits as well as local and state level government, that will be replicable across the country and we’re seeing grass roots efforts in these different communities to standardise around best practises that have already been established.

For example in one county in Florida, as part of a rooftop solar challenge programme they developed an online permitting tool that would make it easier for their residents to get solar permitted and interconnected. They are currently working with their adjacent communities to cover the whole state of Florida with an established process that seems to work really well.

There’s no reason that the paperwork should be different for an adjacent community – and it really is different.

What’s a good way of ensuring that if you have for-profit companies involved, the benefit is felt across the industry, rather than by the individuals or individual companies?

Dr Lidijia Sekaric: We have requirements for disseminating information on our programmes – in addition to any information that needs to be publicly disclosed in any government activity. We do a lot of work…to disseminate and showcase to the entire industry what is happening and the developments.

We also organise showcases for our recipients where in fact we have had different parts of the industry get together and form partnerships. So in some cases the innovation that we might fund in a supply chain of tool-making for example may well benefit every single manufacturer because they will all be sourcing it from there – so that’s certainly one aspect of it.

In addition we do believe that if there is a cost reduction and an advantage, one player might innovate and lead the market place for a short period of time and the rest of the companies in the industry will certainly follow that leadership.

ML: I think that the greatest success that we have here is when we have the innovation that we help support with federal tax dollars, if the companies actually make products that will be solutions in the marketplace for consumers and businesses, that’s the real testament to success. It takes businesses to sell products that will create the solutions in order to have the large impact on society.

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