Utility commission rejects Duke Energy's funding plan for solar project

Charlotte, N.C.-based Duke Energy (NYSE: DUK) must find a new funding source for part of its $50 million program to place its own solar panels on rooftops of homes and businesses.

On Dec. 31, the North Carolina Utilities Commission approved the utility's plan to place 10 megawatts of Duke-owned panels on private roofs to feed into the electric grid. The utility plans to use the project as an experiment to gauge the most cost-effective method to generate a mix of renewable energy.

But the utilities commission says Duke Energy can't recover the entire $50 million cost through rates because the utility would be paid significantly more per kilowatt hour than a third party providing solar to the grid.

The commission noted that Duke Energy granted a contract to SunEdison in 2007 to feed solar power into the grid at a much lower cost than Duke itself planned to acheive (see Duke Energy to get solar power from SunEdison). Financial terms of that deal weren't disclosed.

The Duke-owned solar plan, first announced in September, was cut in half after complaints that it was anti-competitive for the utility to own solar systems on private roofs (see Duke Energy seeks $100M in solar equipment).

The utility can recover the cost difference if it proves the $50 million was justified as a research-and-development expense, the commission ruled.

Duke expects to hire contractors for installation and equipment in early 2009 and finish installation by late 2010.

Southern California Edison, a unit of Rosemead, Calif.'s Edison International (NYSE: EIX)
announced a similar project in March. SCE said it planned to invest $875 million in 250 MW of solar on two square miles of rooftops.

Cleantech developments making news in the past 24 hours

• New agriculture tech from BiOWiSH aims to replace crop burning
• Report: Water, wastewater sectors on a growth spurt in Thailand
• Novomer, Kodak partner on bioplastics manufacturing
• Mumbai firm eyes potential water treatment acquisitions
• Hyflux, JGC commit to desal plant expansion in China

View the last week of cleantech developments here | Subscribe to full feed