2011-10-27 / Local & State

Pennsylvania Losing Solar Jobs With End Of Subsidy

By Kevin Begos

PITTSBURGH (AP) – Supporters of solar energy believe Pennsylvania is on the verge of losing businesses and jobs, as a popular subsidy program winds down. And some are questioning how the state can object to the relatively tiny solar subsidies when it does so much to help the Marcellus Shale natural gas industry.

Some solar companies blame Gov. Tom Corbett for not supporting the industry, but experts add that real cost issues and the state’s not-so-sunny climate are big factors, too.

The Pennsylvania Sunshine program, passed in 2008, provided $100 million in solar rebates to homeowners and businesses to install such systems. That led to a boom, but the program has only a few millions dollars left, and the state has no plans to renew it.

“Some firms have moved to Ohio already, and we are considering that. By springtime we’re going to be looking at layoffs, or have to open another location in another state,” said Joe Morinville, the owner of Energy Independent Solutions in McKee’s Rocks.

He said some of his competitors have already left Pennsylvania for states that are continuing to support for the industry.

Karen Foltz, a spokeswoman for Pittsburgh-based Vox Energy Solutions, said the current climate for solar businesses in the state is hardly welcoming.

“People are losing their jobs,” said Foltz.

Sharon Pillar, a solar project manager for the environmental group PennFuture, agreed.

“Yes, we definitely know that's happening. And it’s happening very rapidly,” Pillar said. “The whole industry is facing a precipice here.”

Despite recent claims that China's solar industry is being unfairly subsidized, hurting U. S. companies, Foltz said Gov. Tom Corbett's administration is the problem, not China.

“He is so against renewable energy, it’s a crime,” Foltz said, adding that she believes Corbett is “100% backed” by Marcellus Shale companies who see solar energy as a competitor. Foltz also claimed that tax credits for oil and gas exploration dwarf what’s given to solar firms.

Pillar said that in 2005, Pennsylvania was a national leader in legislation supporting the solar industry, but has now fallen far behind neighboring states such as New Jersey that have more robust subsidies.

But some experts said the fundamental issues have nothing to do with Corbett – or any other politician.

“Just how much sense does solar photovoltaic make in Pennsylvania?” asked M. Granger Morgan, head of the Department of Engineering and Public Policy at Carnegie Mellon University.

Morgan said that while solar costs have come down, it’s still simply far more expensive than conventional fuels or even wind-generated power.

“I don’t know anybody who isn’t in favor of figuring out how to get energy from the sun,” Morgan said. But he asked whether the best way to get to that goal is “to subsidize the daylights out of the existing technology.”

“ There comes a point maybe you should be asking yourself: aren’t there better ways,” Morgan said, noting that Pennsylvania simply doesn't have nearly as much sunlight as southwestern states.

Patrick Henderson, Corbett’s energy executive, pointed out that solar firms have varying needs.

“When you talk with different solar installers, the value of a state rebate differs within their business plan. In some, it’s a critical component, in others, it's not,” Henderson said, adding that the variety of firms adds to the difficulty of identifying the role government should play, if any.

Henderson said the solar firms he’s met with haven't been pushing for a new round of subsidies, in part because they know the state has serious financial problems.

“They understand the governor had to work with the Legislature to close a $4.2 billion deficit,” Henderson said.

And there’s at least one thing the governor and his critics agree on.

That is that solar power in Pennsylvania grew so rapidly after the $100 million in rebates from the 2008 Sunshine Program that there was an unexpected downside.

Another state program gives solar producers a certificate for every 1,000 kilowatt hours of power they produce. That certificate is sold, generally to utility companies, and the goal was to give homeowners and businesses a flow of income to pay off their systems.

But the market became flooded with solar certificates in Pennsylvania, and the selling price plunged from about $300 to the current $50. So people who bought a solar installation on the assumption they would get $2,000 back every year are now receiving only a few hundred dollars.

Henderson said that raises the legitimate question of whether the program was too much, too soon.

“It’s been very successful and it’s been a good thing” to get solar out in the field in Pennsylvania, he said. “But anytime you subsidize something, you are helping to hide the true cost from the consumer. You want to be sustainable, but you need to compete well with other energy sources.”

Some big overseas firms are also hiring workers in the United States. A spokesman for China’s Suntech Power Holdings Co., the world’s largest manufacturer of solar panels, said the firm now directly employs more than 200 people nationwide.

In late 2010 the company opened an 117,000-squarefoot plant in Arizona. It runs 24 hours a day, with further growth planned. The panels produced at that plant thus meet federal standards for made-in-America products.

Some Pennsylvania business owners said that cutting subsidies here risks losing all the investments that have been made in solar so far.

“What is the cost of not supporting the market that’s already been created here?” Morinville asked. “All of the jobs you created here are going to go to another state.”

Morinville said his business grew from two to 15 employees over the last few years, and that he pays people $25 to $35 an hour, with full benefits. That's been possible because many people do want solar power in the state, he said.

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