Pricing the Public Good

Deck: 

Weighing green energy’s costs and benefits.

Fortnightly Magazine - July 2011
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As I was editing this issue of Public Utilities Fortnightly, I was struck by the competing arguments presented in three different articles—all of which consider the relationship between energy policies and the public welfare.

One author—Mike Hall, CEO of developer Borrego Solar—examines California’s solar feed-in-tariff (FiT) and its potential for bringing solar into the generation mix. In “Cali Gets it Right” he argues that the California FiT has the potential to accomplish “virtually all of the major policy objectives.” Namely, it will award power purchase agreements based on the results of a reverse auction, effectively letting market forces determine the value of solar generation, rather than having policy makers set the subsidy price. Additionally, the program is tailored specifically to distributed solar projects, which Hall says “make good use of real estate from which no other … public benefit can be derived.”

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