Half a century ago, inventors at Bell Telephone Laboratories in Murray Hill, NJ, developed the first photovoltaic (PV) cell. Comprising boron and silicon, the cell was about the size of a razor blade (2 cm²) and was able to convert 5% of sunlight into 5 MW of electricity. Media reports at the time boldly predicted that the new technology's electricity generation someday would far surpass the amount of electricity derived from hydroelectric turbines or fossil fuels.

The media buzz was perhaps a bit premature. Despite the fact that in 2002 the solar-power industry shipped more than 500 million PV cells capable of producing an excess of 500 MW of electricity at 15% to 20% efficiencies, the United States still uses more fossil fuels than ever before. Of course, each year Americans use more electricity than ever before too. During the energy crisis of the late 1970s, solar energy was offered as a viable energy alternative for residential use; yet, despite available federal tax credits, installing solar collectors was too expensive for most homeowners. In these days of skyrocketing fossil-fuel prices, an aging electrical grid, and the impending loss of some hydroelectric facilities, however, solar power is fast becoming the brightest spot in electrical generation.

Solar power long ago made inroads into certain applications and locations; space satellites, ships, trains, and buildings too far from the grid have installed PV systems out of necessity.

"'Off-grid' is where the PV market evolved from," says Strategic Accounts Manager Richard Eidlin of Golden, CO's Altair Energy Inc. (www.altairenergy.com). "Any building not directly tied to the electric grid - remote homes or industrial sites, US Park Service facilities - has had to find an alternative energy source, and in many locations, PV fits the bill."

Altair Energy, a member of the Alpha Technologies Group (www.alpha.com), was formed in 1998 by principals with decades of experience in both the electric-utility and solar-electricity industries. An engineering service company for the growing distributed-generation industry, Altair provides turnkey services to consumers, builders, government, companies, and utilities through more than a dozen authorized service providers in Colorado, California, Washington, Arizona, and New York.

"For those remote sites, electrical energy is stored in batteries," Eidlin relates. "Today, however, larger-scale industrial users are also turning to PV to supplement or replace electrical power from the grid. This application is solar power's fastest-growing sector."

Bay Area Container Storage Company Contains the Sun

Altair, in conjunction with its local affiliate Eastwood Energy Corporation, recently completed a 142-kW project in the San Francisco Bay Area for Container Storage Inc. (CSI), which will offset 80% of CSI's facility load. (For comparison, the average home uses 3 kW/yr.) Altair and Eastwood collaborated to provide turnkey installation services, including optimum siting of the 15,000 ft.² array, interconnection and self-generation approval from Pacific Gas and Electric (PG&E), and system commissioning and acceptance testing.

"At the end of 2002, CSI found that their electric bill had increased substantially, and they thought maybe PV was a way to solve that problem," says Eastwood Energy President John Eastwood. "We made a project proposal, and CSI saw that if they invested in PV, they'd receive significant benefits from federal and California tax credits, as well as from accelerated depreciation. Sure, the project cost about $950,000, but the system has nominal maintenance cost, and, long-term, you're getting almost free electricity."

"We received an 800-amp panel - plenty for our needs," says CSI Owner Forrest Rhoades. "We chose solar because Eastwood came out with a great proposal. Then there was also the buyback of the system with tax credits - but I also liked being a bit more independent of the power company. To keep tabs on how the system is working, Eastwood will install an iMON device, which measures the power produced versus the power used. We'll be able to access this information on the Internet; it will tell us at any given time about electricity use and generation. The system just went on-line in December [2003]. At the end of [2004], Pacific Gas and Electric will come to us with a final tally of what power we drew from them and what power we generated back to them - hopefully the billing total will be zero dollars."

"He's talking about net metering,'" Eastwood explains, "which is how the system works if someone's tied to the electric grid. If you were out in the country and used solar power, you'd store the excess power you generated in batteries. When the sun went down, you'd run electricity from the batteries. But if you're connected to the grid, here's how it works:

"Let's say it's a bright, sunny day, and the PV panels are generating much more power than you can use right then. Because you're tied to the grid, you're feeding electricity to it rather than taking from it; your electric meter runs backward. It's like PG&E is storing the electricity for you, which you will need back when the sun goes down. At one time, utility companies didn't like the idea of net metering, but now, due to problems with deregulation and blackouts, utilities encourage it."

Altair does not manufacture PV panels; components for the project were produced by either Sharp or BP Solar. "We typically use single-crystal technology; at 13% to 16% efficiency, it's the most efficient," Eidlin says. "The solar panels have a 20- to 25-year warranty, and the inverters - the devices that convert the PV panels' direct-current electricity to a building's alternate-current electricity - have a five-year warranty, so they will eventually have to be replaced. We're working on producing an inverter of our own making."

"Don't be confused by the efficiency ratings; those are not based on 100%," Eastwood warns. "A lot of [research and development] is going on to improve PV's efficiency, but its maximum theoretical efficiency is only about 26% because of the physics of the laminate used."

Eastwood, a 40-year veteran of the energy industry, has experience in a variety of generation processes. "I've worked with hydroelectric, nuclear, and wind power. My company can provide solar, wind, and hydroelectric consulting. Solar is up now because of state-funded programs, and it's also less controversial than putting up wind turbines. Yes, solar is maybe 5% to 10% more expensive to start with, but it's here and now, and not in Iraq."

San Diego: Run on Sun

PV power is bringing lower electricity bills home as well. A combination of factors - higher utility costs, more efficient and affordable PV systems, state rebates and tax incentives, and the ability to sell excess generated power back to utility companies - is making residential PV use more common.

"Homeowners are buying PV systems for various reasons," Eidlin says. "They dislike their utility company, they have environmental concerns, and state rebates or incentives make PV power comparable in cost to grid power."

Selling one's excess power back to the utility company, however, also requires the company's cooperation. "Many utilities are open to this technology; some in California are proponents of PV because in the long term it's to their advantage, especially in cost," Eidlin adds. "PV gets boosts from the state or local level, ordinances support it, and deregulation and incentive programs are in place. In Nevada, for instance, a certain percentage of electrical power has to come from renewable energy. Conversely most federal money over the years has been geared toward fossil fuels."

The City of San Diego, CA, has geared its money and efforts toward renewable energy - not only by establishing programs to benefit its residents but also by developing and using renewable sources for city buildings.

"Following the energy crisis three years ago, the mayor formed the San Diego Energy Conservation and Management Office, which looked at every conceivable way to manage our use of energy for city facilities," reports Tom Story, senior policy advisor for the mayor of San Diego. "That same group does engage with the California Public Utilities Commission and the California Energy Commission on issues that have direct impact on our constituents, particularly on rule-making and tariffs that affect how we deploy distributed-energy and renewable-energy sources. Last fall [2003], the mayor and two council members set a goal to achieve an additional 50 megawatts of renewable power in the next 10 years. We now have a 180-kilowatt capacity in PV alone and generate 17.5 megawatts from renewables - landfill gas, PV, hydroelectric."

To make the energy plan work for all, leaders in the business sector are recruited to serve on San Diego's Sustainable Energy Advisory Board. "Chaired by a local builder, it's charged with the task of helping develop strategy for achieving the 50-megawatt goal and encourage private developers to use renewables. Manufacturers, installers, bank financiers, utility companies, and one of the area's largest employers, Qualcomm, all are represented on the board. We're also very fortunate to have the US headquarters of the Japanese firm Kyocera - the largest manufacturer of PV cells in the world - right here," Story continues.

Not only is San Diego interested in creating energy, but it's also dedicated to saving it. "The US Green Building Council's LEED [Leadership in Energy and Environmental Design] program has four standards for major renovations for city projects; in 2002, we committed to the silver standard - enhanced energy-conservation programs," he adds.

Seemingly small changes can glean large results: "Converting our 16,000 traffic lights to LEDs [light-emitting diodes] saved five million kilowatt-hours," Story says. "Also we're finding ways to generate electricity in the most interesting places. For example, this is the first time it's been done - [the first time] the workings of our solid waste management plant have generated electricity. When the effluent travels from the plant to the ocean, it makes a 50-foot drop. By installing a generator that takes advantage of the force of that drop, we're able to generate 1.35 megawatts of power. We jokingly call it our 'poop power plant.'"

San Diego operates several net-zero energy buildings that use PV to generate all of their daily power needs; the city also has experimented with other sustainable-energy sources. "In some cases, we've developed capacity for methane and used it in city facilities," Story says. "In another case, a private contractor built a conversion plant, and then we'd buy the electricity, paying him about half what we'd usually pay the utility company. He then could sell the rest to other customers at whatever price the market would bear. About 10 years ago, we had a combustible-garbage-fuel plant, but the county lost money on it, so we closed it down."

Increasing the use of homegrown energy should make California less dependent on expensive fossil fuels and out-of-state resources. "Natural gas is the fuel of choice for in-state Ôpeaker plants' - electrical generation plants operated during peak-use times. We have one nuclear plant in the county, which is maybe 30 years old; outside the city, there are some wind-power installations," Story explains. "Most of California's electricity is imported from other states; sometimes it's from Arizona, and sometimes it's from Washington - it depends on the time of year. There's also a chance electricity could come from south of the border, as some electricity-generation plants in Mexico have recently gone on-line. However, a state law requires that all utilities must have 20% of their energy portfolio in renewable resources by 2017, and there's a bill pending in Sacramento to accelerate that goal to 2010."

In 2003, San Diego conducted a Regional Energy Infrastructure Study to determine projected needs. "What is the need? What does the market look like? What is our strategy?" Story asks. "We wanted to answer these questions. We've invested a lot of resources in infrastructure, to have a higher energy IQ. We want to know how we're going to decrease our vulnerability to imported power [from outside the region]. We think we've created an ambitious but doable strategy of using renewables, so they will eventually produce 40% of our energy supply. If other cities want to see some of our results, they can check the San Diego Regional Energy Office Web site at www.sdenergy.org."

To underscore sustainable energy's importance, building projects that include energy generation are given top priority. "Our Sustainable Buildings Expedite Program is a boon to builders. If your project includes 50% residential or 30% commercial that contains renewable-energy sources, our building department moves those permits to the top of the pile, which saves private contractors and investors much time and money," Story says. "The only way we can meet our goal is if we can attract private developments to do what we're doing with renewable energy. A classic example is K.D. Development, a leading homebuilder in this area. They've not only benefited from our permit expediting, but they've also used California tax credits to build PV-powered residences that help us meet our goals while also reducing homeowners' utility bills. K.D. has built a 180-unit apartment complex that uses PV cells to generate 0.25 megawatts; they're also using tankless water heaters, which heat water on demand instead of using lots of energy to 'Thermos it all of the time."

Homegrown Sun Power

K.D. Development has built 4,000 units in the past 28 years: 2,200 in San Diego and the remainder in Las Vegas. K.D.'s forte is multifamily production buildings, with living spaces sized between 1,000 and 2,000 ft.²

"Years ago I did a lot of solar-water heat, but it became a bust out here. Due to the hardness of the water, it ate the pipes. I gave up on that," K.D. President Mike Turk recalls. "In Nevada, I learned about conservation; we packed R-19 insulation in all of the walls. Here in San Diego, there are stringent energy codes. The Climate Wise-Energy Star program sets guidelines for energy efficiency; if you get 15% to 20% more efficient, you get rebates from the energy company.

"My friend Dick Murphy was running for San Diego mayor awhile back," Turk goes on. "He wanted me to build energy-efficient and renewable-resource-powered homes. After he won the election, Murphy really stressed this idea, and I soon found myself chairman of the Sustainable Energy Advisory Board, and then started building PV-powered homes."

Working with Altair Energy, K.D. Development created The Trails Complex, which involved installing PV units to create a total of 210 kW on six three-story apartment buildings and the community clubhouse. Each apartment building received 34 kW, with each of 180 individual apartment units receiving a 900-W grid-tied PV system, individually metered and supported by its own inverter. The sun will provide about 80% of Trails homeowners' electric needs.

"Altair sold us the PV systems and materials," Turk explains, "and one of my Las Vegas electricians was installing them. Altair's Scott Whitley put the package together, and now Altair does the installations."

A second project involves installing upwards of 100 grid-tied PV systems on new single-family homes in San Diego's Pacific Beach area. Each system will provide 75% to 80% of a home's total monthly electrical usage. How are the homes selling? "About the time they're framed," Turk says, "they're sold.

"Homebuyers like them a lot. The solar power is the one thing that might make people come out to look at the homes. Sure, the collector panels stand out on the roof, and some people don't like them. But the panels have no glare problems - maybe you'd think the PV panel is a skylight. I try to make the panels aesthetically pleasing by using asphalt roof shingles of the same basic shade, or sometimes I use a mansard roofline to hide the panels. Other people are sold on the panels; I have some customers who have bought their second home in two years from me because of the solar."

Depending on the amount of power desired, PV systems cost $10,000-$40,000; however, Altair Energy helps builders take advantage of California Energy Commission rebates, which can reduce the installed cost by up to 50%.

"I don't know that the PV systems add anything to the selling price of our homes right now," Turk says. "Maybe [they add] a little bit, but we're in such a hot market that I think it makes the difference, adds a competitive advantage. No matter if I build two or 82 units, the components are the same. Maybe the solar homes cost a little more money, but they give an added advantage: You don't have to maintain the system; it takes care of itself. I definitely think the PV will add to the homes' resale price. I was going to give buyers the solar rebates, but people didn't like that, so I take the rebates and lower the prices of the homes. Homeowners do get tax credits for using solar, though."

According to Turk, there might be only one limiting factor to how much solar power a house can generate: "Sometimes multifamily units run out of roof space."

Sixty homes have currently been built in San Diego, and K.D. has another 440 in the pipeline. Is another such development planned for Las Vegas? "Nevada has no rebate program, and I was tired of commuting back and forth. I'll build all of these homes in San Diego," Turk says. "However, we're just now having a bit of a problem with the panel roofs. Since last year's wildfires, the city wants class-A fire-resistant roofs, and the panels are only rated to class B. We'll have to work on that because people really want these houses. I don't even have to advertise; I just put a sign out at my development, and the buyers come."

Solar might work well in the Southwest, but what is its future in colder, gloomier parts of the nation? "Yes, how well solar works does depend on the climate, but we're developing a number of projects in New York City, for example," Altair's Eidlin says. "Actually solar often works better in a cooler climate because, being constructed of glass and aluminum, panels can become hot to handle, and you don't want them to overheat. Because of possible heat loss, PV panels might offer more efficiency on a sunny October day than on a hot July day. There aren't too many places where PV panels won't work."

JANIS KEATING is a frequent contributor to Forester Communications publications.

DE - March/April 2004