Both distributed and utility-scale solar energy projects are vital to accommodate the world’s growing energy needs as they are both suited to harness the extraordinary power of the sun.   The underlying technology used by utility and distributed solar is different and understandably, each has its own proponents and detractors.  For the most part, utility-scale solar projects use solar collectors to generate enough heat to power a steam turbine that in turn generates electrons.  Distributed solar energy derives primarily from the use of photovoltaic panels that capture photons and convert them into electrons. Distributed PV efficiency is improving all the time.   Currently, there is a conversion efficiency of approximately 17% for crystalline silicon panels and 10% for thin film panels — a dramatic improvement from only a few years ago.

In California alone, there are plans for 35 utility-scale projects that would generate approximately 12,000 Megawatts (MW) of energy annually — an amount of energy comparable to the combined power of ten nuclear power plants.  The Mojave Solar Project and the Genesis Solar Energy Project, both located in southern California, are two of the largest projects under consideration and are each aiming to generate 250M watts of energy. These projects are expensive, however, in terms of both dollars and natural resources required. The federal government has promised to help reduce the financial cost by allocating a portion of the stimulus plan for this purpose.  Companies that have their plants ready to be opened by the end of this year will receive a portion of the $67 billion of federal money that has been set aside for renewable energy projects (including loan guarantees and grant programs).

Despite these incentives, it is risky to undertake a large-scale enterprise like utility-scale solar power in an uncertain economic climate, as financial institutions are reluctant to be involved in billion-dollar projects.   Another issue is the fact that such solar ‘farms’ require huge tracts of land. Another challenging issue for utility-scale solar projects is the use of water.   Combined, the Genesis and Mojave projects would use 1.24 billion gallons of water per year due to the wet cooling systems involved.

An alternative to utility-scale projects is the use of distributed solar energy.  There are various types of renewable power technologies in use, but sub-utility scale power photovoltaics (PV’s) account for 98% of the distributed solar energy market.  Unlike utility-scale projects, distributed energy is solar power on a small scale and entails the installation of solar panels on the roofs of buildings.

Distributed solar power does not involve the legal red tape, the large tracts of land, or the vast quantities of water that utility-scale projects require, and has the ability to generate enough energy for homes, schools and hospitals.   Installation is easily addressed and solar panels can last for up to 30 years if well maintained.   The price of solar panels has dropped dramatically to approximately $2.40 per watt (price depending on scale of order) for silicon panels and is likely to drop even further in 2011.   Furthermore, unlike utility-scale projects, distributed solar projects such as the Southern California Edison’s Plan spread capacity evenly, distributing benefits and drawbacks.   If a utility-scale project “crashes,” it affects a huge area.  With distributed energy, only individual units are affected in the case of a power outage.

In many locations and in certain circumstances, distributed solar projects are less expensive than utility-scale solar projects because of the avoidance of both new transmission lines and line losses — the latter of which typically accounts for approximately 7% of the power shipped over transmission systems. The costs associated with utility-scale solar projects are often not included in the side-by-side economic comparison made between the two forms of solar power development.  An additional benefit of distributed solar is its ability, when developed in clusters (i.e., local micro-grids), to alleviate the need to upgrade distribution substations and add local peaking plant capacity.

As mentioned, distributed solar plans have their detractors. Solar certainly is not the cheapest source of electricity and is only effective in areas with a high percentage of sunshine.   More than 50 million Americans live in Community Associations where we might expect to see efficient adoption of distributed solar plans. But these locations commonly have policies limiting the use solar equipment due to height restrictions or other specifications regarding roofing materials.

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