Missouri’s Solar Business: A Case of Supply and Demand
By Christopher Chung, CEO, Missouri Partnership
August 25, 2011 | Reposted from www.renewableenergyworld.com
It’s no wonder that the Optimal Deployment of Solar Index, released by Professor Matt Croucher of Arizona State this year, ranked Missouri as the fourth best state in the nation for solar power. With the sixth lowest cost-per-watt to install solar power, high demand, and above average opportunities for jobs in the industry, it’s clear that Missouri has a sunny future in solar energy production.
Part of Missouri’s high demand for solar energy stems from recent legislation. In 2004, the city of Columbia adopted a local renewables portfolio standard requiring its municipal utility to generate or purchase 15 percent of its electricity from renewable sources by 2022 with a goal of meeting one percent of that portfolio with solar energy.
Four years later, Missourians overwhelmingly approved a similar measure calling for 15 percent of the state’s electricity to originate from clean energy sources by 2021, including a two percent carve-out – or 190,000 megawatt hours (MWh) – to be derived from solar sources. Missouri was one of the earliest states to adopt such a measure and remains one of only 16 states with an RPS to include solar.
Missouri offers numerous government loans and incentives for solar energy. Its solar rebate, solar renewable energy credit incentives, federal investment tax credits, Linked Deposit Loan Program and Property Assessed Clean Energy loans for commercial developments combine to provide a solid footing for solar growth.
In 2009, the state formed the Missouri Solar Energy Industry Association (MOSEIA) with the goal of increasing market growth for Missouri’s solar industry. This group focuses on regulatory language to enhance Missouri’s solar initiatives and to pass subsequent legislation.
As legislative incentives grow, solar energy jobs should follow. Missouri already has favorable rankings for solar jobs and business costs. The state also has the fifth lowest corporate income tax index and the third lowest business costs, which creates an ideal environment for new business developments.
The physical environment also bodes well for solar development. Missouri has more than 200 sunny days per year, for an average of 4.5 to 5.0 kWh per square meter per day. Missouri’s solar resources actually exceed those of Germany, which leads the world in solar energy production on less than three kWh per square meter per day.
Other factors likely to influence the growth of solar jobs include Missouri’s central location, its healthy manufacturing environment, and a concentrated energy storage sector with R&D capabilities. Missouri is located within 600 miles of 52 percent of U.S. manufacturing establishments and has the ninth best transportation network in the nation. Ease of transportation is particularly significant to the solar energy sector because large and cumbersome solar panels are expensive to ship.
The state’s many benefits have not gone unnoticed by the solar sector. According to a new report from the Brookings Institution, Missouri ranked sixth for solar photovoltaic jobs in 2010 and eighth for degree of solar photovoltaic job specialization. The state also nabbed the number eight spot for growth in solar thermal jobs from 2003-2010. Manufacturers of solar components in the state are capitalizing on that potential. For example:
- Milbank Manufacturing recently announced plans to invest $2.7 million for new production lines in Kansas City where solar components will be made. The expansion is expected to create 57 new jobs.
- Solutia, headquartered in St. Louis, provides critical components for use in the solar energy market including encapsulants for solar modules, heat transfer fluids for concentrated solar power plants and PV film coatings.
- Dow Chemical is currently working with the city of Columbia to develop a solar park and production site where a new solar shingle will be tested. The project is expected to be Missouri’s largest solar site.
With Missouri’s solar energy outlook leaping forward, a number of large solar arrays have also been popping up across the state. Emerson Electric, headquartered in St. Louis, recently built a new data center in Missouri powered by more than 550 solar panels. At peak output, the array meets about 16 percent of the center’s energy requirements.
KCP&L in Kansas City has announced plans to install rooftop solar technology at selected commercial buildings, government facilities and residences as part of its smart grid demonstration. The installation is part of a $24 million grant from the Department of Energy.
Recently, the St. Louis Housing Authority, along with Sunwheel Energy Partners, completed a $10.4 million solar installation on 73 residential properties. The 600-kW project provides enough electricity to power 70 homes for a year and eliminates the carbon dioxide emissions equivalency of 170 cars.
Missouri’s colleges and universities are very much a part of the solar discussion. Missouri Science and Technology University (Missouri S&T) in Rolla, for example, has built a “solar village” of homes created by students for the annual Solar Decathlon in Washington, D.C. The homes, which are designed and built yearly for the competition on the Washington mall, are rebuilt on the S&T campus and made available to students and staff. The school recently won a grant from the Environmental Protection Agency (EPA) for research in solar energy and energy management, which will enable students to use hybrid solar thermal electric panels (STEPS) in house design.
Missouri S&T has also led in design of the solar-powered car, taking first place in theNorth American Solar Challenge in both 1999 and 2003. The school’s Energy Research and Development Center was born out of that effort, and now collaborates with the University of Missouri-Columbia (MU).
Also in Columbia, MU, professor Patrick Pinhero, Ph.D. has developed a solar panel that collects up to 95 percent of the sunlight that falls on it. That’s more than four times the amount collected by traditional solar panels. Fortunately, MU is also home to the Center for Sustainable Energy, which is dedicated to commercialization of renewable energy innovation, through support and coordination of research and education.
On the eastern side of the state, Washington University in St. Louis has the distinction of being the first university in the world with a department of Energy, Environmental & Chemical Engineering. This cutting-edge, multi-disciplinary program, established in 2006, works to further research in renewable energy innovations and address global energy challenges.
And no doubt about it, the challenges are real. Researchers, manufacturers and corporate citizens agree on that much. But, like the sun itself, Missouri is rising to the challenge, using its resources, its research and its business climate to steer the future of the solar industry.
Christopher Chung is Chief Executive Officer of Missouri Partnership, a public private non-profit corporation working closely with the Missouri Department of Economic Development and regional and local economic development organizations around the state.