Los Angeles has the largest municipal solar program in the country, but its growth is being limited by backlogs at the Los Angeles Department of Water and Power, according to a preliminary study released Friday by UCLA and USC researchers.
Researchers presented the results of the study at City Hall on Friday morning as part of a workshop on LADWP’s feed-in tariff program.
The program allows commercial properties with rooftop solar panels to sell power to LADWP at competitive fixed rates.
The agency plans to purchase 150 megawatts of power through the program by the end of 2016. Currently seven megawatts are being generated, with about 50 more in the pipeline.
The study finds that the slow pace for solar power generation from the program is largely due to a limited administrative staff at the agency.
“The biggest obstacles right now are staffing — their program staff has not been adequate to meet the applications and to process those applications,” said J.R. DeShazo, director of the Luskin Center for Innovation at UCLA.
DeShazo said that the pace of approval and construction would need to increase greatly if the goal is to be reached.
“We need about four megawatts a month until the end of the program, and we’ve not been generating even 10 percent of that so far,” he said.
The 2016 goal is important because that’s when federal tax incentives for solar construction are set reduce from about 30 percent to 10 percent.
DeShazo said lowered incentives will make it less likely that solar projects will be seen as viable business decisions.
“The solar developers — which have promised to build projects if their applications are accepted — their economics will change dramatically as well, and that will probably cause most of the projects to fall out of the program,” DeShazo said.
The research was commissioned by the Los Angeles Business Council. Previous research funded by the council has shown that a 150 megawatt feed-in tariff program would generate $500 million in economic benefit and create 4,500 jobs within the industry.
An official at the California Solar Energy Industries Association said more needs to be done to simplify the process for people interested in purchasing and installing solar panels.
“The industry has been frustrated by the bureaucratic hurdles put in place by the DWP in terms of going solar, whether that’s a homeowner or a business wanting to invest in solar," said Bernadette Del Chiarro, executive director of CALSEIA. "There’s far too many roadblocks put in the way, especially in comparison with the rest of the state.”
“The DWP is getting better," she added, "but they’re still far short of where they should be in terms of making it easy for their customers to go solar."
The way forward
The researchers recommended that LADWP increase its full-time staff dedicated to processing approvals for the feed-in tariff program. They also called for a reprioritization of projects based on how quickly they can be completed, rather than in the order they were received.
A spokesman for LADWP said some of these steps are already underway. The administrative staff has been increased to six or seven, with dozens more engineers and technicians available to shift focus wherever is necessary.
He said that the agency also instituted a policy last week that sets aside 25 MW for projects that show higher likelihood of timely completion.
“We believe that we’ve taken the appropriate measures to get this program on track and to have this program delivered by the date that we anticipated that it would be — the end of 2016,” said Jason Rondou, solar programs manager at LADWP.
Rondou said delays shouldn’t solely be blamed on LADWP but also on the developers working to build the projects. He said the agency has begun requiring that proposed projects be completed within a year.
“These are shared projects. We need to work together to get these things done sooner,” Rondou said.
He said that the agency intends to increase its solar capacity to about 800 megawatts by 2025, with an additional 800 megawatts in renewable energy sources that could be generated from solar power.
“The intent of this is to learn and grow," Rondou said. "Right now we’re learning how to optimize the feed-in tariff program. We’re going to expand it."