HB 145 Equals a Cleaner Environment and Economy
Heather L. King
January 19, 2012
What if you could rely on the sun to power your business, your home, your children’s school or your local church? The probability of this actually happening in Utah is one step closer to reality.
During the 2010 Utah legislative session, Representative Bill Last (R-District 71) and Senator Steve Urquhart (R-District 29) presented House Bill 145 to enable innovative financing for renewable energy technologies (electricity generation through solar and wind).
In essence, HB 145 allows Utah’s government and nonprofit entities (schools, churches, etc.) to enter into financing agreements (third-party power purchase agreements or PPA) that function like a mortgage or auto lease where they use and benefit from the solar panels or wind turbines powering their buildings without having to own or pay for the equipment up front. In exchange, the third-party financing company receives tax benefits for installing renewable energy and also the regular payments from the customer to use the renewable energy technologies.
According to Julia Pettit, corporate finance renewable energy attorney of counsel at Stoel Rives, the benefits of HB 145 are widespread. “There are going to be some great opportunities to get solar systems and maybe small wind installed across the state. So it creates job opportunities for the installers and it creates the ability to reduce our energy demand.”
Right Time for Renewables
Thanks in part to the passage of HB 145, Salt Lake County hopes to double the amount of installed solar energy in the state. Mayor Peter Corroon has set a goal to install 11 megawatts of solar on as many county-owned facilities as possible. “We realize that we can have buildings that are energy efficient and be healthy for the people who work inside of them as well,” he says.
Although HB 145 was initially meant for all commercial businesses in Utah, a last-minute amendment to the bill refined it so that it applies only to local government and nonprofits interested in installing on-site renewable energy. However, there is a solar rebate offered to private companies by the Utah State Energy Program using stimulus funds.
And while the financial incentives are important, it’s notable that numerous Utah companies are moving forward with sustainable initiatives regardless of the tax incentives. Sarah Wright, executive director for Utah Clean Energy—a public interest organization that advances renewable energy, energy efficiency and clean energy technologies—explains the trend. “In the past five years there has been a change in the way that business and industry look at sustainability and energy efficiency through an economic lens. It makes sense to build the most energy-efficient building because your cost to operate that building will be less, your employees will be happier because it’s a better place to work (better lighting, air quality, comfort) as well as they can market their sustainability.”
Two local architecture firms who specialize in sustainable building design have put this very example into practice in their own headquarters. Local solar installer, Heliocentric, installed 68, 215-watt solar panels on FFKR Architects’ home office in downtown Salt Lake. In January 2010, FFKR began producing solar power on-site to offset some of the office’s electricity usage. Having designed the State of Utah’s first LEED Platinum-certified building for Rio Tinto at Daybreak, the installation was important to FFKR’s ongoing commitment to sustainable design practices and will help the company’s office achieve LEED Silver certification from the U. S. Green Building Council.
Salt Lake’s largest architecture firm, Architectural Nexus, recently moved into new home offices on Parley’s Way and hopes to eventually produce 100 percent of its power needs from the 26 kilowatt solar panels installed on the roof as part of its application for a LEED Platinum-certified building. “Our goal was to set an example and take our facility from being dependent on the energy produced in the region to being able to produce our own energy so that this facility will be energy independent on electricity,” says, Don Finlayson, president of Architectural Nexus.
West Valley-based Pioneer Solar provided the installation and developed an innovative visual display system to report metrics in real-time—allowing visitors to see how much solar energy is being generated and how much less carbon dioxide is produced.
Why is HB 145 Critical?
The short answer is that the state, as well as the nation, is in need of new ways to meet peak power demands. Wright explains, “Rocky Mountain Power and PacifiCorp are looking at needing 2000 megawatts of new energy resources in the next 10 years. In Utah, many people think that renewables are against fossil fuels but we have to realize that our consumption is growing rapidly and we need it all. We need to start diversifying with efficiency while we still have our fossil resources.”
Pettit agrees, “The state itself has been a little behind the game in terms of really understanding the opportunities that are associated with renewable energy because it’s much broader than just a wind project or a solar project. It’s really about taking a look at the global economy and finding a way to move forward and create new companies, new technologies, new jobs while we are also creating an opportunity for ourselves to become more energy independent.”
With the passage of HB 145, Utah can now enter the clean energy economy with similar financing (PPA) and protections as neighboring states such as Colorado, New Mexico, Arizona and Nevada, which have all been very progressive in offering programs and statutes designed to support the renewable energy industry.
“It begins to make Utah a player in our region. And with that comes opportunity to bring in renewable energy manufacturers and projects—things that will be a huge economic benefit to our state,” says Pettit.
Ultimately, HB 145 opens the door for high-paying jobs in the renewable energy field and, with the addition of every solar panel or wind turbine, demand for energy is reduced during the peak summer hours when we need it the most.