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If you build it will they come? Solar farm fails to attract buyers in St. George

Published: Sunday, Aug. 12 2012 1:00 p.m. MDT

SunSmart, a community solar farm in St. George. (James Young, Deseret News) SunSmart, a community solar farm in St. George. (James Young, Deseret News)

ST. GEORGE — Myron Porter is proud to show off his three-bedroom home. He does what he can to save electricity. And he happily bought into his city's ambitious solar energy farm, built three years ago at a cost of $1 million. 

"This is the good life, living in St. George," he said. "We love our city for being progressive on trying a new, renewable energy."

But Porter's decision to spend a sizable amount of money to support the city's solar energy project makes him a striking exception in St. George. Most residents have chosen not to participate in the solar farm, providing a snapshot into the collision between energy and pollution solutions, and a user's willingness to pay more for cleaner energy.

SunSmart, a community solar farm in St. George. (James Young, Deseret News) SunSmart, a community solar farm in St. George. (James Young, Deseret News)

Residents say they either can't afford it or have given their own financial interests a higher priority. Some simply may not believe the solar farm provides enough societal and environmental benefits to justify their own investment.

Several years ago, in a battle over a coal-fired power plant, those attending public meetings stood and said they'd be willing to pay more for "green power," according to city official Rene Fleming who oversees the solar farm.

"And here we have a green resource, and those people did not want to participate," Fleming said. 

Porter and his wife, Joan, bought one unit in the SunSmart solar farm — about five solar panels — for $6,000. "We get a rebate on our electricity bill, a discount per month, on how much it generates out there," Porter said.

SunSmart, a community solar farm in St. George. (James Young, Deseret News) SunSmart, a community solar farm in St. George. (James Young, Deseret News)

Since Porter bought in, the city lowered the price from $6,000 to $5,000. But the solar units still are not attracting a lot of buyers.

"The participants, as they buy in, they reimburse us," Fleming said. "(We have) 250 units, and we've sold roughly 33." A few idealistic residents have bought more than one unit. In all, just 26 residents in the entire city have bought into the solar farm. 

The reticence of St. George residents stems from the probability that buyers won't ever recover their initial investment through lower utility bills — unless other sources of electricity get far more expensive.

"Yeah, certainly were disappointed" in the St George outcome, said Sara Baldwin, senior policy and regulatory associate at Utah Clean Energy.

SunSmart, a community solar farm in St. George. (James Young, Deseret News) SunSmart, a community solar farm in St. George. (James Young, Deseret News)

 "The federal tax credit is not applicable to this project.  That changes the economics significantly. That's a significant deterrent, for sure."

The  federal tax credit is 30 percent of the system cost; if you install it at home, you qualify for the credit. But if you buy into a community project, you don’t qualify.

 "My understanding is the project was launched at an inopportune time. The economic decline and the recession hit shortly after that project hit the ground."

 Porter notes with sarcasm the difficulty from a financial standpoint: "Oh, it's a great investment! It's only $6,000 to buy it, and we're getting ten to twelve dollars a month back. That means I won't live long enough to recover it. But we're doing it to support the city."

SunSmart, a community solar farm in St. George. (James Young, Deseret News) SunSmart, a community solar farm in St. George. (James Young, Deseret News)

The unsold solar panels still generate electricity for the region's utility grid, so the city doesn't consider it a waste of money.

"So, a disappointment, but certainly not a disaster," Fleming said.

Porter believes he's doing his part to get a clean energy source off the ground, even if it's not cost-effective today. "With any new industry, it's never practical, because they have to buck the established systems," he said.

The price for solar photovoltaic — installed solar PV, — has decreased in the past year about 50 percent, according to Baldwin. "That's a precipitous decline that obviously translates to better economics for everybody. That trend we expect to continue."

SunSmart, a community solar farm in St. George. (James Young, Deseret News) SunSmart, a community solar farm in St. George. (James Young, Deseret News)

 "As more people go solar, the price per installed kilowatt will continue to decrease and be more cost effective."

 She said there will be a point the the future when solar energy is competitive with utility grid prices.  That price point is what ultimately may attract users to cleaner energy.

E-mail: hollenhorst@desnews.com

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