After years of hard work by dedicated solar installers, key legislators, electric utilities, and other stakeholders, Washington State now has an improved solar program! The new program will help drive the Washington State solar industry forward, while at the same time ramping down the state incentive rates over the next few years. This victory is largely owed to Washington’s leading solar installers, who put many dedicated hours into crafting a solar program that I think will ultimately serve the industry well.
Many of Olympia’s lawmakers also worked hard on this solar legislation over the years. In the end there was strong bipartisan support in both the House and the Senate, and I think it’s important to recognize those lawmakers who sponsored the solar bill, championed it, and finally got it over the goal line.
A hardy thank-you to Representative Jeff Morris and Representative Norma Smith for their tireless efforts to make the solar program better. They were both willing to dive in with all the stakeholders, hammering out solutions and compromises to get the solar legislation where it needed to be. I have been humbled by the amount of effort and dedication it takes for legislators to champion bills through the sausage grinder of our legislative system.
Thank you to Senator John McCoy for championing the bill in the Senate, and to Senator Doug Ericksen for sponsoring the Engrossed Substitute Senate Bill 5939 that ultimately made it to Governor Inslee’s desk to be signed. Governor Inslee is a strong supporter of growing a clean economy in Washington State, and the passage of this solar program is one key step in this vision.
Photo source: https://www.flickr.com/photos/cop21/23563078076
WHY THIS LEGISLATION MATTERS
There are several great summaries of the program available at SIW and elsewhere, so I am not going to summarize the bill. Instead, I will focus on what the new program means for the solar industry in Washington as whole and what it means for Itek Energy.
The solar industry in Washington State has slowed a little in the past year-and-a-half as the utilities began to reach their legislative caps under the original program. The new program is going to turn that around immediately.
Bellingham Foodbank Solar Array - Itek Modules
The uncertainty that plagued the previous solar program is now gone. The new solar program raises the incentive caps three times higher, and provides eight years of incentive payments to new residential, commercial, and utility-owned solar projects. From this foundation of predictability we will see not only a growth in the residential solar market, but also in the newly-created opportunity for large-scale projects—up to 1,000 kw in size for commercial and 5,000 kw in size for utility. These are major additions to Washington’s solar program, and I expect to see a correspondingly sharp increase in the solar installation rate by the end of the year.
Another market driver is the provision for a fixed eight years of incentive payments, with a cap at 50% of the cost of the project. That means a project owner will receive the same economic benefit over the life of the system—regardless of what time of year the system is installed. This will result in stronger solar sales through the winter months, and a more stable solar market.
The new solar program has a budget of $110 million and a goal to install 115 megawatts by 2020. I think attaining both of those benchmarks is within the capabilities of our local solar industry. In 2015, Washington State installers built over 25 megawatts worth of projects, with Itek suppling nearly all with Washington made modules. With the new legislation, we are poised to do it again. Even though the state is ramping down on the incentive rates for Made-in-Washington modules from $0.54/kwh to $0.21/kwh, Itek has grown—expanding into a new factory this summer and realizing economies of scale—allowing for significant price reductions.
Domestically manufactured solar modules are more important than ever. Washington’s new incentive program is opening up markets for installations up to 5,000 kw in size. Until now, our state has only had a few projects on this scale, so we are about to see a lot more. In our new factory, Itek will be the first in the US to manufacture a five bus bar, 72 cell module with integrated optimization (370 watt peak). By integrating optimization and long-string capability, Itek’s new 72 cell modules will reduce costs and boost power. Our 370 watt, 72 cell module will be a strong contender for many of the new commercial and community solar projects that will be installed under the new incentive program.
With the new, stable incentive program, Washington’s residential solar market is poised to rise again. Competition for these projects will be close, and Itek is again positioned to provide strong value to Washington State homeowners. Itek’s new, five bus bar 60 cell module delivers at 305 watts; and with our new factory’s capacity, Itek will be able to offer a more competitive price.
Habitat for Humanity Solar Install with Itek Modules. Photo Credit: Greg Williams, Sunergy Systems.
I expect the new incentive program will boost Washington’s solar market in the next couple years. Our recent expansion, LEAN training, low overhead, and nimble nature put Itek in a strong position to support Washington’s solar industry growth over the next few years.
Itek is committed to being Washington’s number one supplier of solar modules. Washington’s solar market has been critical to our success and this new legislation will continue to play a major role in Itek’s development by providing the foundation that we can build upon to launch our product on a national scale and support the national solar industry with high-quality, US-manufactured solar modules.
From the beginning, Itek has had a goal of achieving independence from government incentives. John Flanagan, owner and founder of Itek Energy, envisioned that if we kept the overhead low, used the best equipment in the industry, and trained employees well we could compete with anyone else manufacturing in the US. I believe Itek has arrived. We are continuing to grow our national presence while supporting the next stage of Washington’s solar growth.