RPS Solar Carve Out, Ohio

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Fact Sheet
RPS Solar Fact Sheet OH.pdf

RPS Solar Carve Out Ohio

Renewable Portfolio Standard (RPS)                               

Renewable Portfolio Standards (RPSs) are a policy tool enacted by many states to stimulate growth of the renewable energy industry. They require utilities to generate or purchase a certain amount of their electricity from renewable sources within a specified time frame.  If a utility does not meet this goal, they are often subject to a penalty known as an Alternative Compliance Payment (ACP). Renewable Energy Credits (RECs) are tradable credits which represent the electricity generated from a renewable resource that utilities can purchase to meet their RPS goal. Solar Renewable Energy Credits (SRECs) are a form of RECS that represent electricity generated from a solar system. RECs are subject to market dynamics with the set ACP effectively functioning as a price floor. RPSs are different in every state.

Solar carve outs and credit multipliers are included in most RPSs because the programs tend to favor lower cost renewable technologies, and these programs provide incentives for the deployment of more costly technologies.[1] Solar carve outs require a certain percentage of the RPS be met with solar energy, while credit multipliers offer additional credit toward compliance for energy derived from solar sources.  From 2005-2009, 65-81% of the total grid connected PV in the United States(excluding California) occurred in states with active or forthcoming solar carve outs.[2] The types of solar technology eligible under these incentives vary depending on a state’s RPS goals.

Solar Installation across the US                                        

  • The United States has over 5,700 MW of installed solar electric capacity[3]
  • In the Mid-Atlantic states and New York about 23% of solar installations were attributed to RPSs[4]
  • 16 States and the District of Columbia have unique solar or direct generation (DG) carve outs in their RPS[5]
  • If full RPS compliance is achieved there will be 93 GW of new renewable energy online in the United States by 2035[6]

Ohio RPS

Ohio’s RPS, called the Alternative Energy Portfolio Standard (AEPS) was passed in 2008, requiring electric distribution utilities and electric service companies to meet certain standards for renewable energy generation. Municipal utilities and electric cooperatives are excluded from the standard. The state standard for renewable energy is 12.5% by 2025.[7] Ohio has a solar electric carve out of 0.5% by 2024.[8] Under the AEPS, PV and electric producing solar thermal technologies completed after January 1, 1998 are eligible. The Solar Alternative Compliance Payment (SACP) currently set at $350/MWh, will be reduced by $50 every two years until 2024. ACP payments will be deposited into the Ohio Advanced Energy Fund, which provides financial support to renewable energy and energy efficiency projects in Ohio.[9]  At least 50% of Ohio’s RPS must come from energy produced within the state, and the remaining 50% can come from outside sources.[10]

Americans Support Solar

  • 9 out of 10 Americans approve of renewables[11]
  • The solar industry employs nearly 143,000 Americans[12]
  • In order to reduce costs for the rate payer, many states have cost caps of for their RPS. Ohio has a cost cap of 3%.[13]

Solar Prices Declining: Nationally, the average solar installation price declined by 19.3% and the price of residential systems fell by 15.3% year-over-year.  Installation prices fell in every major residential market with many states reaching installed costs as low as $4.00/watt.[14]

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[1] DSIRE. SOLAR, Solar Set-Asides in Renewable Portfolio Standards. http://www.dsireusa.org/solar/solarpolicyguide/?id=21

[2] Wiser, Ryan, Barbose, Galen & Holt, Edward. (October 2012). Supporting Solar in Renewable Portfolio Standards: Experience from the United States, p. 25. http://eetd.lbl.gov/ea/ems/reports/lbnl-3984e.pdf

[4] Barbose, Galen (November 1, 2012). Renewable Portfolio Standards: A Status Update (Power Point Presentation), p. 15. Lawrence Berkley National Lab

[5]  Id.

[6]  Id.

[7] DSIRE. Ohio: Alternative Energy Portfolio Standard. http://dsireusa.org/incentives/incentive.cfm?Incentive_Code=OH14R&re=1&ee=1

[8] Barbose, Galen (November 1, 2012). Renewable Portfolio Standards: A Status Update (Power Point Presentation), p.7. Lawrence Berkley National Lab.

[9] DSIRE. Ohio: Alternative Energy Portfolio Standard. http://dsireusa.org/incentives/incentive.cfm?Incentive_Code=OH14R&re=1&ee=1

[10] Id.

[11] SCHOTT Solar Barometer/SEIA (2011). New Poll: 9 Out of 10 Americans Support Solar, Across Political Spectrum. http://www.seia.org/news/new-poll-9-out-10-americans-support-solar-acros...

[12] The Solar Foundation (January 2014). National Solar Jobs Census, p.5. https://www.dropbox.com/s/2qvjb3oaimsp4ty/TSF%20Solar%20Jobs%20Census%20...

[13] Barbose, Galen (November 1, 2012). Renewable Portfolio Standards: A Status Update (Power Point Presentation), p. 29. Lawrence Berkley National Lab.

[14]SEIA/GTM (2012). U.S. Solar Market Insight Report: Q3 2012, Executive Summary, p.10.  http://www.seia.org/research-resources/solar-market-insight-report-2012-q3



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