Going further, some states specify targets for particular forms of renewable power. Delaware, for instance, has an RPS requiring that, by 2019, 20 percent of the state’s electricity come from renewable resources. Of that 20 percent, the state mandates that at least 2 percent must come from solar technologies. Such carve-outs ensure that the state’s energy mix (i.e., its “renewable portfolio”) is somewhat diversified.

On this topic, CleanBeta relays a clever forecast of U.S. installed solar power capacity:

Most Aggressive State Solar Energy Policies

Notably absent is California, which has an aggressive RPS but doesn’t mandate a solar carve-out. (California — being the solar power behemoth that it is — would probably be off the above chart, anyway. Literally.)

Another noteworthy point: how would existing state-level RPSs be impacted by the creation of national standards? The American Clean Energy and Security Act (ACES), which squeaked by the House on June 26, includes (among other things) a provision for the creation of a national renewable energy standard (RES). As written, it would require all investor-owned utilities to produce or buy at least 15 percent of their energy from renewable resources. The provision provides some flexibility, allowing states to meet a considerable portion of the 15-percent requirement through energy efficiency measures. (For a great overview of ACES as it stood before the June 26 vote, read here.)

As is often the case with nationwide policies, some states are ahead of the curve, and some are behind. Accordingly, my guess is that states with more aggressive RPS targets would maintain them, selling their excess renewable energy certificates (RECs) to states that are falling short of the 15-percent minimum requirement. All others would be required pony up for the new national standard by (1) buying RECs, (2) increasing in-state renewable energy generation, and/or (3) promoting in-state energy efficiency.

Facts? Thoughts? Opinions?

UPDATE: The national RES is bound to be one of the topics covered at the Intersolar Conference, being held this week in downtown San Francisco. If you attend, drop us a line.

UPDATE #2: Check out this reprinted article from Kevin Eber at the National Renewable Energy Laboratory. It reviews four states that have recently added or updated renewable energy standards: Kansas, West Virginia, Nevada and Maine.

Solar Power and State Renewables Standards

I think this was an extraordinary first step. You know, if you had asked people six months ago — or six weeks ago, for that matter — whether we could get a energy bill with the scope of the one that we saw on Friday through the House, people would have told you, no way. You look at the constituent parts of this bill — not only a framework for cap and trade, but huge significant steps on energy efficiency, a renewable energy standard, huge incentives for research and development in new technologies, incentives for electric cars, incentives for nuclear energy, clean coal technology. This really is an unprecedented step and a comprehensive approach.

In addition to expressing his support for Friday’s vote, Obama was quick to downplay the bill’s provisions for establishing carbon tariffs, in a bid to allay concerns over U.S. protectionism. The Administration also honed in on the Senate, which is set to take up the legislation later this year — and where much stiffer conditions for passage are expected.

In the end, the problem with politcs — or, more accurately, policy making — is that it’s a messy, imperfect process. Regardless of whether you think the House bill goes too far, or doesn’t go far enough, the fact remains that something resembling a nationwide energy/climate policy has passed the first hurdle (albeit narrowly). I’ll be the last person to suggest that ACES is flawless. But impeccable policies — especially nationwide ones — are rare. Let’s at least celebrate the fact that our leaders in Washington care enough about our future generations to engage the carbon/climate policy debate. And let’s be confident that, regardless of the pitfalls that will invevitably arise when it comes to implementation of the bill’s final version, our economy — our workers, our knack for ingenuity, and our appreciation for smart solutions — will rise to the occasion.

House Passes Climate Bill

Now, in the face of a crumbling economy, Congress may consider transforming the credit into direct payments from the federal government. As reported by Greentech Media,

Language in the draft stimulus bill making its way through Congress calls for turning the investment tax credits that solar power developers rely on into direct payments to investors for the next two years, observers of the bill say.

“On a short term basis – 2009 to 2010 – solar projects will have a Department of Energy program in place to provide for grants to be paid within 60 days up to the eligible tax credit amount,” Chris O’Brien, head of North America market development for Swiss solar equipment maker Oerlikon Solar, said. There is no cap on the amount that can be paid out, he added.

Such payments would clearly provide a boost to the solar sector. As it stands now, there is little demand among investors for the 30-percent credit. Again, here’s Greetech media relaying the sentiments of Rhone Resch, President of the Solar Energy Industries Association, which he expressed back in November 2008:

“The investment tax credits available for solar are a very effective tool when you have the tax credit appetite. When that tax credit appetite starts to decrease, which we’ve seen literally over the last 60 days or so, they become less useful.”

For a while, the setup worked brilliantly: tax equity investors — like AIG, Wachovia and the now-defunct Lehmen Brothers — would provide cash to solar developers in exchange for the tax credit, which they would then use to offset their tax liability. Unfortunately, the arrangement has hit a snag. It’s no secret that 2008 was a rough year for the financial sector. Since few (if any) such banks and investors posted profits, none had a need for the credit. And with the S&P down almost 6 percent on the new year, 2009 isn’t looking much better. As goes January, so goes the rest of the year…

So, hence the current push in Washington to make the 30-percent ITC “refundable” — that is, to put cash directly in the hands of solar developers. Seeing that the solar sector will likely need between $10 billion and $12 billion to keep up growth through 2009, we can understand why Andrew Beebe of Suntech Power suggests that, “the industry really needs this.” Whether Congress will put future American taxpayers on the line for yet another stimulus initiative is anyone’s guess. In the interim, all we can hope is that the solar sector will end 2009 in a stronger position than where it began.

Congress weighing changes to investment tax credit

The problem remains funding. The bill has received extensive bipartisan support, but there’s a line in the political sand firmly dividing Democrats and Republicans on the money issue. The Democrats want the tax credit extension to be fully paid for by reducing or closing out certain deductions for oil and gas companies. Senate Republicans have been quick to raise the “new tax” flag, but really, there is no new tax. Just fewer old tax breaks. Have a look at the list of funding sources, taken directly from the bill (available in PDF format).

• Sec. 401. Limitation of deduction for income attributable to domestic production of oil, gas, or primary products thereof.
  Sec. 402. Elimination of the different treatment of foreign oil and gas extraction income and foreign oil related income for purposes of the foreign tax credit.
  Sec. 403. Broker reporting of customer’s basis in securities transactions.
  Sec. 404. 0.2 percent FUTA surtax.
  Sec. 405. Increase and extension of Oil Spill Liability Trust Fund tax.
  Sec. 406. Nonqualified deferred compensation from certain tax indifferent parties.
  Sec. 407. Delay in application of worldwide allocation of interest.
  Sec. 408. Time for payment of corporate estimated taxes.

So decide how you feel about the funding for the tax credits based on the above. Some might say that with a deficit of over 9 billion dollars, maybe adding the roughly $18 million of the renewable energy tax credit extension is just a drop in the pond. Proponents of fully funding this bill, however, insist that it’s the fiscally responsible thing to do.

In a somewhat surprising move, the Senate has attached the provisions of the renewable energy tax credit bill to the economic bailout bill that being voted on (again) today. It’s difficult to say if this is an inspired idea, or if it’s just condemning the energy bill to the same resolution-less bickering the bailout is receiving. If that fails, HR 7060 won’t be up for another vote until mid-November at the soonest. As a roadblock to the bill’s passage has been President Bush’s threat of a veto if the funding provisions are left in, who knows if the bill will stand a chance (as is) until the new year, though. We’ll certainly keep you updated here at GetSolar.com.

Solar Tax Credit Decision Postponed…Again