Two European utility companies have decided the best way forward for them is to stop fighting the advent of solar power and get on board. Both have inked new partnership deals with solar panel producers to create one stop shopping opportunities for their customers. This approach has been much in the news lately, after Elon Musk, head of Tesla Motors and SolarCity, announced the two companies would combine to offer customers complete solar systems with one click of the mouse convenience.
Many European nations have substantially reduced the incentives offered for new solar systems, leading to a dramatic slow down in the number of systems being installed. For instance, the number of new installations in the Belgian solar market fell to less than 10,000 in 2014. In calendar year 2011, when incentives were at their highest, more than 100,000 systems were installed.
The new initiatives in Europe are spurred by the realization that solar panels are now so inexpensive, they can be installed profitably even without financial incentives. As an example, a system that cost €20,000 a few years ago can now be installed for €6,000.
Electrabel, a subsidiary of French utility company Engie, does business in Belgium. It will partner with Sungevity, the fifth largest solar panel manufacturer in the United States. Belgium is still culturally separated into two regions with distinct regulations. In Wallonia, situated in the southern part of the country, new solar systems could cut power bills by up to 1,200 euros per year and earn a return on investment of up to 17 percent. In the northern Flemish region, where rooftop solar owners pay a 300 euro per year grid fee and get no subsidies, customers could cut bills by 500 euros and earn a return on investment of up to 11 percent.
“The utilities have a strong customer base; the solar companies have the technical competencies. We expect these types of combinations will develop,” says Alexandre Roesch, head of Brussels-based industry lobby SolarPower Europe.
Swiss utility Alpiq says its Helion Solar division, which has 10 percent of the rooftop solar market in the country, is forming a partnership with Ikea to install solar panels manufactured and sold by the Swedish company. It did not release financial projections for the venture.
Not all, but many US utility companies are kicking and screaming about the coming solar power revolution. They like the way things used to be — coal comes in, steam is made, turbines make electricity, and everybody earns a nice, safe, government guaranteed rate of return. Solar has kicked over the apple cart and a lot of companies don’t like it one little bit.
But as the Rocky Mountain Institute pointed out in a 2015 study, utilities have a golden opportunity to re-imaging themselves as providers of many services people want. That’s because their wires permeate every residence and business. Wires can carry things other than electrons — internet services, for example.
Utilities could become a vital part of the Internet of Things revolution says RMI, earning extra profits by providing much need ancillary services. All they need do is pull their heads out of the sand, see what’s going on in the world, and figure out how to adapt to the new norm. Utilities in Europe are doing it. American utility companies could stop acting like petulant children who have had their candy taken away and start acting like responsible adults. Just a thought.
Source and photo credit: American Energy News
A tip of the hat to Geert Ramaut, a faithful CleanTechica reader who lives in Belgium.