If you live in Palo Alto or have visited there, you can attest to the California city’s charms, from the agreeable climate and lovely leafy streets to the cultural vibe supported by Stanford University and more tech savants per square mile than probably anywhere else. And now Palo Alto has something else going for it: It’s a CLEAN city, as in a participant in the Clean Local Energy Accessible Now program.
The Palo Alto City Council unanimously voted to adopt the CLEAN program, which is essentially a feed-in tariff (FIT) with a much cuter name. What this means for Palo Alto is that City of Palo Alto Utilities (CPAU) has agreed to pay a fixed rate of 14 cents per kilowatt-hour during the next 20 years for locally produced solar energy.
FITs have a been a big tool in encouraging solar development in Europe and we’ve reported often on the FIT in the Canadian province of Ontario. The idea behind FITs is to encourage renewable energy projects by guaranteeing those who undertake them a price for the power produced. Then, as a renewable energy scales up and becomes more cost-effective to implement, projects won’t need as much of a subsidy (or none at all), allowing the FIT to decline and eventually disappear.
During the 2012 pilot phase, the program is slated to add up to 4 megawatts (MW) of solar power to the local grid through medium- and large-scale commercial projects. Companies producing a minimum of 100 kW can start submitting applications April 2 to sell their entire solar energy output to the CPAU grid at the contracted rate. If all goes well, CPAU plans to expand the program in 2013 to include other types of renewable energy and allow additional project sizes to participate.