U.S. government announces funding to make solar cost-competitive by 2015

WASHINGTON, DC, US, July 26, 2006 (Refocus Weekly) The U.S. government will provide US$170 million over three years (FY07 to FT09) for cost-shared, public-private partnerships to advance solar energy technology.

Secretary Samuel Bodman of the Department of Energy says the solicitation is part of the Solar America Initiative of President George Bush and an integral part of the president’s commitment to diversify energy resources through grants, incentives and tax credits.

The aim of the SAI is to reduce the cost of solar energy systems to make them competitive with conventional electricity sources in the United States by 2015. The goal of the projects funded by the solicitation is to reduce photovoltaic costs from the current 13˘ to 22˘/kWh, to 9˘ to 18˘/kWh by 2010.

“This investment is a major step in our mission to bring more clean, renewable solar power to the nation,” says Bodman. “If we are able to harness more of the sun’s power and use it to provide energy to homes and businesses, we can increase our energy diversity and strengthen our nation’s energy security.”

“I am hopeful that this funding will help reinvigorate innovation in photovoltaic technology that will lead to an expansion in the use of solar energy in this country and the world,” he adds.

The $170 million SAI Photovoltaic Systems R&D Technology Pathway Partnerships (TPP) funding opportunity announcement will focus on development, testing, demonstration, validation and deployment of new PV components, systems and manufacturing equipment. It will be led by industry and may include companies, universities, national laboratories and non-governmental organizations.

The $170 million solicitation is subject to appropriations by Congress.

DOE will require that industry-led teams match their funding, to realize a total investment of $340 million when private funds are included. The prime recipient of DOE funding must be a U.S. company with current or planned manufacturing capacity in the U.S.

The Bush Administration has made significant progress in PV over the past five years, during which time the cost of PV electricity has dropped by 20% and the U.S. PV industry has doubled in size, the DOE explains.

In his recent State of the Union address, Bush announced the Advanced Energy Initiative to reduce dependence on foreign sources of energy. The AEI includes a 22% increase in funding for clean energy technology research at DOE and, as part of the AEI, the FY07 budget requests $148 million for the Solar America Initiative, a $65 million, 78% increase from FY06.

The $170 million solicitation will fund projects in systems class projects (larger projects to address multiple technology improvements in PV system and component design, integration and installation, with annual DOE funding per project of up to $10 million with up to ten selections expected) and subsystems class projects (which focus on specific components or equipment, with per project annual DOE funding of up to $4 million and up to 15 selections expected).

The Energy Policy Act of 2005 provides incentives for purchasing and using solar equipment with a credit equal to 30% of qualifying expenditures for purchase of commercial solar installations through 2007. EPAct also provides a 30% tax credit for qualified PV property and solar water heating property used for purposes other than heating swimming pools and hot tubs. Property owners receive a credit of$4,000 if both PV and solar DHW are installed.


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