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With Passage of SB 90, the Forecast for Solar in Florida Gets Sunnier

by Maria Robinson and Ted MacDonald (May 25, 2017)

The Sunshine State is finally living up to its nickname. In early May, both chambers of the Florida legislature passed SB 90, the implementing legislation for Amendment 4. With Florida state government currently tied up in budget deliberations, SB 90 has not yet been delivered to Gov. Rick Scott. Once it has been, he will have 15 days to sign the bill or let it become law without his signature. With the mechanics for implementation nailed down, the constitutional amendment will extend important property tax exemptions for renewable energy installations, including solar, on both commercial and residential properties. Florida has long been a sleeping giant for the solar industry. Although it ranks third nationally in solar potential, the state is currently 15th in installed capacity. With passage of SB 90, Amendment 4 will fulfill its promise – and open up the market for solar in Florida, which is poised for takeoff.

SB 90 provides the necessary statutory language to implement Amendment 4, a ballot initiative that went to the voters in 2016. Amendment 4 came out of the 2016 legislative session, where bills sponsored by Sen. Jeff Brandes (R-St. Petersburg) and Rep. Ray Rodrigues (R-Fort Myers) sought to allow Florida voters to decide whether to eliminate the ad valorem tax – property tax based on assessed value, exclusive of fixed assessments like fire and rescue or trash collection – on all new commercial solar energy equipment for 20 years. Rep. Lori Berman (D-Boynton Beach) later signed on as a House co-sponsor. This measure passed with broad bipartisan support, including a unanimous vote in the House. It was signed by Gov. Rick Scott in March 2016.

The measure then went on the primary ballot, in part to avoid confusion with a separate solar measure, Amendment 1, which was on the November general election ballot. On August 31, Amendment 4 passed with 73% of the vote, well over the 60% threshold needed for a constitutional amendment to be approved.

As it will now be implemented, SB 90 exempts tangible personal property tax on solar or other renewable energy source devices installed on commercial and industrial property. Ultimately, 80% of the assessed value of a renewable energy source device, which is considered tangible personal property, and is installed on real property on or after January 1, 2018, will be exempt from ad valorem taxation. SB 90 reflects an extension to commercial property owners of the existing tax abatement for solar and other renewable energy devices on residential property. Once implemented by the legislature, the tax incentives would begin in 2018 and extend for 20 years.

This new tax exemption should give the solar market in the state a big boost. Florida has traditionally been a difficult market for renewable energy. This is due, in large part, to the prohibition of third-party ownership of solar installations, with Florida being one of only four states in the country explicitly forbidding this arrangement, which is used by homeowners and businesses to avoid the upfront capital cost. Numerous past attempts to expand solar power in Florida through the legislature failed, including an effort by Sen. Brandes in 2015. There was also a recent campaign to legalize third party sales of solar through the Florida Constitution that failed to make the ballot.

One reason Amendment 4 succeeded was because it was backed by a diverse coalition of groups from across the political spectrum. These included both statewide and national business associations (including the Florida Restaurant & Lodging Association, the Florida Chamber of Commerce, and the U.S. Green Chamber of Commerce), environmental organizations (including The Nature Conservancy and Florida Wildlife Federation), faith-based organizations (including the Christian Coalition), and of course bipartisan support in the legislature. (Or, as Senator Brandes likes to say, the campaign put together “the Baptists and the bootleggers.”) Having a diverse group of supporters made solar issue a much easier sell to voters.

Another reason is that Amendment 4 was offered as a pro-business and pro-economic growth measure. The price of solar panels has dropped significantly in the past several years. Additionally, the market in Florida is ripe for commercial solar, as demonstrated by projects done for the military. AEE member First Solar supplied PV modules for use in three Gulf Power solar plants being constructed by AEE member Coronal Energy on military installations in the Florida Panhandle, with these plants having a total of 120 MW of capacity. Because solar was already exempt from the residential ad valorem tax, it made sense to extend the benefit to commercial property owners as well. By simply offering a tax break, Florida was able to incentivize job-creating investment, consistent with Gov. Rick Scott’s laser focus on jobs and economic growth.

Plus, the time was ripe, given solar power’s growing popularity in Florida. According to the Solar Foundation, Florida already ranks fifth nationally in solar jobs, despite the ban on third-party ownership. This number will only increase, given Florida’s growing population and almost year-round need for air conditioning. Solar growth in Florida is also good for the broader advanced energy market, which totaled $6.2 billion in revenue in 2014. In 2015, advanced energy jobs in Florida, including solar energy, reached 140,000 workers, more than twice as many as in agriculture and more than in real estate, with advanced energy jobs expected to grow 4% last year.

With the passage of SB 90, Amendment 4 is ready to be implemented, and the will of the voters fulfilled. There are now greater opportunities for both Florida businesses and consumers to expand energy choices and control costs. Florida is beginning to realize its potential as a powerhouse for advanced energy, with the future looking increasingly bright.

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Florida Plays Catch Up on Solar Energy Playing Field

by Rachel Iacovone (March 10, 2017) www.news.wgcu.org

Florida is looking toward solar energy as a solution — not only for its energy problems but for its economic issues as well. Though it is the third most populous state, it currently ranks fifth in the nation on solar energy yields. Florida Power and Light hopes to change this, with plans to add three solar sites by 2018 and eight more in the coming years.

Despite its moniker, the “Sunshine State” Florida is not using its solar energy opportunities as much as one might expect.

Florida’s 400 megawatts of solar energy last year pales in comparison to California’s 18,000 and so do the Sunshine State’s 8,200 solar industry jobs when compared to California, which boasts more than 100,000 solar-related jobs.

With Florida making the short list of most populated states alongside California, clean energy proponents, as well as Florida Power and Light, hope to catch up to solar states. FPL spokesperson Alys Daly recently talked about the state’s current solar situation on WGCU’s Gulf Coast Live.

“Right now, our solar is in line with the country’s, which is about 1 percent,” Daly said. “That’s not including the last three plants that we built over on the west coast of Florida, and that’s not including the eight new plants that we’re developing. While the national average is about 1 percent for solar, the rest of their generation is made up of much more oil and coal where ours is clean, natural gas and nuclear.”

FPL has 11 active solar sites. It plans to bring another three online by 2018 and eight more in the future.

Industry experts attribute FPL’s current ability to expand the state’s solar industry to the sharply declining price of solar energy over the years.

Twenty-five years ago, solar energy cost $90 dollars per watt. Now, the price has dropped to $3, and Americans can afford to invest in solar, though Daly says it’s more cost effective to wait on FPL’s expansion rather than invest in personal roof units.

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As rooftop solar costs drop, utility attempts to raise barriers may not work

by Mary Ellen Klas (Nov. 12, 2016) www.miamiherald.com

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Florida’s utility industry steered more than $20 million of their profits into a failed constitutional amendment to impose new barriers to the expansion of rooftop solar energy generation, but developers say that as the cost of installing solar panels drops, the state could quickly become a leader in private solar energy expansion no matter what the energy giants do.

The Florida Solar Energy Industry Association estimates that over the next five years, Florida homeowners, businesses and utilities are projected to take advantage of the falling prices and install 2,315 megawatts of solar electric capacity — 19 times more than the amount of solar installed in the last five years.

“Solar prices are in free-fall, and no one knows where the bottom is,” said Chris Delp, an attorney with the Tampa law office of Shumaker, Loop & Kendrick.

Large companies, such as Elon Musk’s Solar City, are offering zero down, low-interest loans, and people can also cut their expenses by deducting 30 percent of their costs under a federal Investment Tax Credit program that was extended last year, he said. “The economics are just going to make these regulatory barriers irrelevant. Florida’s utilities could work with customers to roll out solar or they could work to rule it out.”

What approach will Florida’s investor-owned utilities take?

Will they encourage homeowners and businesses to install their own solar systems — as utilities in Georgia, California, New York and dozens of others states have done — or will they ask regulators to stifle rooftop solar expansion, as they attempted to do with Amendment 1, so that they can control the development of solar themselves and limit the hit to their bottom line?

According to the Florida Public Service Commission’s 10-year site plan, utilities plan to increase their solar generation, but solar will make up only a tiny fraction of all energy generation supplied by the regulated utilities in the next 10 years. Gulf Power has announced it will add up to 500 megawatts of solar power to its fleet by 2024 and Florida Power & Light has asked the PSC for permission to add 1,200 megawatts over the next four years as part of a settlement agreement to raise its electric rates.

Florida ranks third in the nation for rooftop solar potential, according to SEIA, but is only 14th for cumulative solar capacity that is installed. That could change, Delp said, if the emerging interest in solar installation in Florida, fueled by the drops in prices, results in more people installing their own electricity generation, circumventing utilities.

“I don’t think this was their intent, but what the utilities did with Amendment 1 was bring the discussion of solar energy development in Florida to the forefront,” said Delp, who is working with a company building a 30-megawatt private solar farm in Leesburg. “It’s now a kitchen table issue. There is awareness that there is a lack of solar in Florida and that we lag behind so many other states.”

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Solar Power Tax Exemption Will Be On Florida Ballot

by Jake Richardson (cleantechnica.com) March 16, 2016

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Florida House Joint Resolution 193, Solar or Renewable Energy Source Devices, recently passed the Florida Senate unanimously. “We have given the people of Florida an opportunity to have a voice on solar. If approved by the voters, we have an opportunity to become a leader in solar and bring thousands of jobs to this state. I am confident that the voters will approve this amendment with overwhelming support,” said Senator Jeff Brandes (R-St. Petersburg). 

As a result of its passing, the proposed amendment to the state constitution will be on the August 30th state primary election ballot, and if Florida voters approve of it it will become law. If that happens, solar or renewable energy installed on commercial or industrial properties will be exempt from property tax. Additionally, it would abate ad valorem taxation.

Senator Jeff Brandes (R-St. Petersburg), Representative Ray Rodrigues (R-Fort Myers), and Representative Lori Berman (D-Boynton Beach) are the resolution’s sponsors, so it was a bi-partisan effort.

Some supporters of the resolution are:

Florida Solar Energy Industries Association
Southern Alliance for Clean Energy
The Nature Conservancy
Christian Coalition
Conservatives for Energy Freedom
Florida Retail Federation
Florida Restaurant & Lodging Association

“We applaud and thank Senator Brandes and Representative Rodriguez for their leadership on this legislation which will give Florida citizens an opportunity to weigh in directly on expanding solar energy across the state,” stated Trish Fields, Vice President, State Partnerships and Strategic Engagement at AEE.

Everyone knows Florida has plenty of sunlight, so it could be a solar power leader, though it has yet to capitalize on this abundant, free, and natural resource. Florida also has plenty of rooftops which are currently empty, so there is plenty of space available for solar power systems without having to use land.

According to the Solar Energy Industries Association, there are about 6,000 solar jobs currently in Florida, but that number could be expanded if more favorable solar laws are passed.

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