LONDON — Measuring a utility’s newly installed solar power – including both photovoltaic (PV) and concentrating solar power (CSP) technologies – provides an excellent snapshot of the industry.
Considering everything from distributed customer systems to wholesale contract purchases from independent power producers (IPPs) to utility-owned projects that were interconnected throughout the 2010 calendar year, in terms of annual solar megawatts, California’s Pacific Gas and Electric (PG&E) installed 157 MW in 2010, which secured it the top position in the annual solar rankings. However, PG&E’s 2010 solar portfolio was about two-thirds distributed customer PV projects, with more than 10,000 projects totaling more than 104 MW. PG&E also purchased the output of the 48-MW Copper Mountain PV facility.
In contrast, Florida Power and Light (FPL), the second ranked utility, installed 87 MW, largely based on two utility-owned projects — a 10-MW PV project at the Kennedy Space Center and a 75-MW hybrid CSP power plant at a combined-cycle natural gas plant. Public Service Electric and Gas (PSE&G) of New Jersey maintained its third-place position in 2010 through a 75-MW portfolio, of which about 30 percent was utility-owned and 70 percent was customer rooftop-type projects.
Tri-State Generation and Transmission Cooperative Association, in Colorado, was the highest ranked cooperative utility at sixth on the list, based on a power purchase agreement (PPA) with the 30-MW Cimarron PV project. Other newcomer utilities to this year’s top 10 include Jersey Central Power and Light, ranked ninth after interconnecting 1150 distributed systems in 2010, and North Carolina’s Duke Energy Carolinas, ranked tenth on the strength of two very different projects. Some 12 MW of the 15.5-MW Davidson Solar Facility in North Carolina completed in 2010, along with the deployment of more than 7 MW of utility-owned, customer-sited solar.
All but one of this year’s top 10 players were investor-owned utilities (IOUs), which may be a result of their larger average size relative to municipal and cooperative utilities. The top ranked municipal utilities were CPS Energy, in San Antonio, at number 11 and the Jacksonville Electric Authority (JEA), in Florida, at number 13, both ranked after the completion of larger-sized PV plants under PPAs. After Tri-State Generation and Transmission, the next ranked cooperative utility was Kauai Island Utility Cooperative in Hawaii at number 52 with 0.8 MW.
The total annual capacity of the Top 10 utilities has grown exponentially over the past three years, rising from 167 MW in 2008 to 561 MW in 2010. It required a minimum 20 MW for an individual utility to rank in the Top 10. However, the Top 10’s share of overall capacity declined from 88 percent in 2008 to 72 percent in 2010, indicating a broadening of the market.
Turning to the geographic distribution, seven of this year’s Top 10 utilities were from outside California and four were located in the eastern region, both increases from prior years. Non-California states’ share of the market increased from 25 percent in 2008 to 63 percent in 2010. Overall, US solar markets are expanding well beyond California.
As previously predicted, 2010 was a growth year for centralised projects. In 2010, eight projects greater than 10 MW, totaling 226 MW, were completed, making up 29 percent of the market, versus three totaling 62 MW in 2009. This centralised trend in growth is expected to continue through 2011 and beyond, as 24 projects, each greater than 10 MW and totaling more than 1 GW, are already completed or currently under construction in 2011.
Beyond FPL’s 75 MW CSP project, the rest of the projects in the top 10 were all PV technology, which records 87 percent of the total. These PV projects, which ranged in size from 1-kW residential installations to 48-MW power plants, have much shorter planning horizons and project completion times, along with lesser siting, permitting, financing and transmission requirements at these small- and medium-sized scales. However, larger PV and CSP projects (those greater than 50 MW) require overcoming financing, siting/permitting and transmission barriers that might emerge at these larger sizes. CSP represents over 6 GW of the over 15 GW of future solar projects that are being tracked, but there are differences in project development between CSP and PV. Sub-sections of the larger PV project can be energized over time, resulting in lower construction risk and balance-sheet impact. Conversely CSP projects must be fully completed before commissioning, which may take several years.
Utility ownership was a new impact on this year’s rankings. Thirty utilities reported owning 140 MW of new solar, or 18 percent of the total market, up from an estimated 30 MW, which represented nine percent, in 2009. The Top 10 ranked utilities owned 23 percent of their total annual capacity, with three utilities owning more than a third — Arizona Public Service, Duke Energy Carolinas, and FPL. While most utilities’ future plans for ownership involve distributed projects, 2010 was the exception due to FPL’s two large centralised projects. The utility ownership trend is expected to continue its growth, with at least 1,100 MW of announced utility-owned projects in the pipeline over the next few years.
Per customer rankings
Silicon Valley Power (CA) ranked first nationally with nearly 40 watts-per-customer, followed by PSE&G with 35.2 watts-per-customer. However, these two utilities are very different. Silicon Valley is a California municipal with just under 52,000 customers, average electricity rates and a better-than-average solar resource. It interconnected just over 1.8 MW of PV from 74 distributed customer systems in 2010. PSE&G, in contrast, is a large New Jersey investor-owned utility with more than 2.1 million customers, in a region with higher-than-average electricity rates and a lower-than-average solar resource, which interconnected 75 MW from 1,057 PV systems, of which 13 percent is utility-owned.
The top five utilities were rounded out by Hawaiian Electric Co, Colorado’s Xcel Energy, and PG&E, all investor-owned utilities in the western region. Two newcomers to this year’s survey, Florida’s JEA and Atlantic City Electric of New Jersey, jumped into the rankings. JEA’s 2010 capacity was attributed to the installation of the Jacksonville Solar facility, a centralised 12-MW plant. In contrast, Atlantic City Electric’s 2010 capacity was 100 percent distributed customer projects.
Kauai Island Utility Cooperative, in Hawaii, and Kit Carson Electric Cooperative, in New Mexico, were the highest ranked cooperative utilities at numbers 12 and 17, respectively. Overall, the median watts-per-customer for the top 10 utilities increased by 50 percent, from 20 to nearly 30 watts-per-customer between 2009 and 2010, which indicates that annual solar capacities quickly increased this past year.
This 10 MW installation at the Kennedy Space Center is one of FPL’s largest (Source: Nasa)
In contrast to prior years, larger utilities are now ranking in this category in greater numbers. In 2009, just three Top 10 utilities had more than 100,000 customers, while this year’s list includes seven large utilities — six IOUs and one municipal utility. The rankings of these larger utilities are a testament to the growth of solar – it takes more megawatts to reach these rankings with more customers. However, the watts-per-customer rankings can be much more variable than megawatts rankings since a lower amount of solar from a smaller utility could easily be ranked in future surveys. There was also greater geographic diversity in this year’s list, with utilities from six different states making the list, including three from the East. In 2009 there were four different states, of which none were in the East.
Unlike last year, the watts-per-customer utility portfolios were driven by both distributed and centralised generation projects, but this varied significantly by utility — five utilities had exclusively distributed projects, one exclusively centralised projects (or nearly so), and four a mixture. For example, more than 55 percent of Colorado-based Xcel Energy’s 2010 solar portfolio was achieved through centralised projects while Black Hills Energy Colorado Electric was entirely distributed and JEA nearly entirely centralised.
Utility ownership played a smaller role in determining the watts-per-customer ranking. Two of the ranked utilities, Arizona’s Tucson Electric Power and PSE&G, installed utility-owned projects in 2010, in contrast with six in the Top 10 utilities by megawatts. This is partially due to the fact that three of the 10 are municipals, which for a variety of reasons (primarily taxation) are less likely to own solar projects.
In terms of cumulative capacity to the end of December 2010, Southern California Edison (SCE) and PG&E ranked first and second, respectively, for the third straight year, though PG&E is gaining ground. The majority of SCE’s portfolio (62 percent) is derived from long-standing PPA contracts with the nine SEGS CSP plants, while PG&E’s portfolio is largely distributed, customer-sited systems. PSE&G and FPL were ranked third and fourth respectively, with PSE&G edging FPL by just 0.1 MW or 0.08 percent. A similarly close race was seen between Nevada’s NV Energy at fifth and California’s San Diego Gas and Electric (SDG&E) at sixth, with only 0.5 MW or 0.6 percent separating them. All amazingly close given the multi-year solar development they have undertaken in very different state markets.
All top 10 utilities were investor-owned and eight of the 10 utilities were in last year’s rankings too, with the two newcomers being Atlantic City Electric Co and Jersey Central Power and Light. Both utilities integrated distributed solar for the most part.
Geographically, the Eastern region doubled its representation in this year’s rankings for this category, from two to four. The remaining six top 10 utilities for this category are all located in the West.
The Western region also continues to dominate the 2010 cumulative watts-per-customer rankings. As in the previous three years, all utilities represented in this category were located within the Western region and the top three utilities remained unchanged from 2009. SCE took the top place for the fourth consecutive year and Kauai Island Utility Cooperative — the Top 10’s highest ranked cooperative utility – followed in second place. Californian municipal Palo Alto Utilities maintained its third place ranking for the third year. The diversity of utility types in these top three spots is indicative of the more open competition that this category represents.
Centralised projects accounted for approximately 38 percent of the Top 10’s cumulative capacity while utility-owned generation accounted for less than two percent.
The Eastern region has quickly grown into a major solar market. In the National rankings, four eastern utilities placed in the Top 10 megawatts category and three in the Top 10 watts-per-customer. The Eastern region made up approximately 37 percent of the nation’s 2010 solar capacity, with approximately 50 percent from centralised projects.
FPL took this year’s top spot. Its annual solar capacity increased more than 195 percent from its 2009 annual solar capacity of 29.5 MW. PSE&G, which can also attribute a large portion of its annual solar capacity to utility-owned projects, followed closely in second. Additionally, five newcomers placed in this year’s Top 10: Jersey Central Power and Light, Atlantic City Electric Co, JEA, as well as PECO Energy Co and Metropolitan Edison Co both from Pennsylvannia. Overall, the Top 10 represent eight IOUs and two municipal utilities from six states.
The Central region represented less than six percent of the nation’s total annual capacity in 2010. However, despite having limited solar RPS requirements, the region is displaying strong growth, having increased its annual capacity by 350 percent between 2009 and 2010 with Ohio and Texas proving to be growing markets.
This year’s top ranked utility was CPS Energy, the municipal utility for the city of San Antonio, Texas, which had more than seven times the annual solar capacity of last year’s highest ranked utility in this category after the completion of the 14.5-MW Blue Wing Solar project. Ohio Power followed in second place, after signing a PPA for the energy generated by the nearly 10-MW Wyandot Solar facility. These two projects made up about two thirds of the regional total.
This year’s top ranked utilities include four municipal utilities, five IOUs, and one wires-only utility across five states within the region.Utility-owned solar did not play a large role in the region during 2010, with less than one percent of Top 10 capacity coming from utility-owned solar.
The Western region continues to lead the nation, with nearly 57 percent of the country’s annual installed solar. California contributed 63 percent of regional solar capacity in 2010, followed by Colorado with 17 percent, Arizona with 11 percent, and Hawaii at three percent. However, many of the remaining states in the region, such as Nevada, Oregon and New Mexico also have active solar markets and utilities.
PG&E and SCE maintain their number one and two positions respectively, while Tucson Electric Power climbed onto this year’s list after seeing the installation of a diverse group of both centralised and distributed projects in 2010. Six of the utilities represented in these rankings are also present on the national MW rankings list. The Top 10 changed little from 2009, with eight utilities repeating from last year.
Altogether, this region saw the installation of nearly 29,950 PV projects in 2010. In addition, nearly 30 percent of the region’s capacity was obtained from centralised projects, all of which were PV.
Cooperative utilities, by the nature of their more rural service territories, are some of the smaller utilities in the country. They have traditionally ranked well in the watts-per-customer category. However, with more and more IOUs adding unprecedented amounts of solar to their grids, it has become difficult for the cooperatives to maintain high national rankings. Nonetheless, in 2010 cooperative utilities increased their total annual solar capacities by nearly 690 percent.
Investor-owned utilities represent the largest customer base of the three major utility types, representing more than 56 million customers or 81 percent of the survey total. Similarly, they represent the largest share of national annual solar capacity, at 84 percent.
This year’s IOU top 10 is nearly identical to the national Top 10, with each utility moving up one spot since Tri-State G&T, a co-op, was removed. The lone exception was New Jersey’s Atlantic City Electric, which ranked 10th on the list and whose 2010 portfolio was entirely composed of distributed, customer-owned PV projects. IOU utilities ranked 11 and higher made up about 17 percent of the category total, compared to 11% last year.
Municipal utilities have traditionally ranked in both the Top 10 lists. While 2010 saw strong municipal solar growth, these utilities only appeared in the national watts-per-customer rankings this year, despite installing the fifth and sixth largest solar projects last year.
As a whole, municipals had a very strong year for solar. The annual capacity from all participating municipal utilities was 87.5 MW — an increase of more than 165 percent over the 2009 total. The top 10 utilities represented all three regions, led by the Western region with six utilities, followed by the Eastern region with three and the Central region with one.