Nevada steps closer to solar economy

By Phoebe Sweet

Saturday, Dec. 22, 2007 | 7:28 a.m.

Bill Clinton predicted it.

The Nevada Development Authority has promised it.

Solar power developers are praying for it.

Now some experts say it's nearly here: a new clean-energy economy for Southern Nevada.

The past two weeks brought the announcement by renewable energy company Ausra of a new manufacturing plant in Las Vegas that plans by spring to be producing the components for large solar thermal power plants. And the largest solar photovoltaic power plant in the country opened at Nellis Air Force Base.

With new clean energy regulations in California creating a huge market for solar power, and Nevada facing increased energy needs, experts say the groundwork is laid for an economic boom in Southern Nevada.

"It makes a perfect storm not only for solar production but also manufacturing of the components that go into the plants," said Chris Zunis, vice president of economic development for the Nevada Development Authority. Zunis has worked for two years to bring clean energy companies to Las Vegas and he helped persuade Ausra to locate a factory here. "That was a strong message to the industry."

But stakeholders, from solar developers to politicians to the state's largest utility, say there are still hurdles ahead for the industry, including the lack of long-term federal subsidies for solar development.

Among Nevada's advantages: available land for development and a business-friendly climate.

"California needs 17 gigawatts (enough to power almost 13 million homes) or roughly $50 billion in clean power plants to be built between now and 2020," said John O'Donnell, executive vice president of Ausra. "About a third of those could be outside the state."

Ausra hopes to take advantage of that market with its Detroit-style automated manufacturing facility, slated to open this spring in Las Vegas. The plant will triple the world's current production capacity of the components for large-scale solar thermal power plants. The company is looking at several sites near Las Vegas to build solar generation projects.

The prospect of high-tech jobs and investment - not to mention the environmental benefits - a solar economy could bring has many Nevada politicians salivating.

Even the governor, often knocked for his environmental record, has come out hard recently for an extension of national solar tax credits he says will stimulate Nevada's economy.

Others, such as Sen. Harry Reid, have boasted that solar power could become one of Nevada's chief exports.

And because of a requirement that the state's largest utilities, including Nevada Power Co., buy a percentage of their energy from renewable sources, parent company Sierra Pacific Resources has lobbied nationally for an eight-year extension of a solar investment tax credit.

Utility executives say tax credits bring the cost of solar in line with prices for power produced with natural gas and coal. Tax credits would offset costs until the industry is up and running and prices are determined by market forces.

Rhone Resch, president of the Solar Energy Industries Association, said some Nevada politicians could show better leadership on clean energy policy, including pushing for solar tax credits, that would have positive effects on the state's economy.

"It's interesting to note that Sen. (John) Ensign voted against expanding the tax credits for solar and voted for preserving incentives for big oil ... when Nevada has the best solar resource in the country and no oil," Resch said after touring the Nellis Solar Star project, a 14-megawatt facility that began providing about one-quarter of the base's power needs this month.

"We're hopeful Sen. Ensign will recognize the role that solar can play in his state and will get behind this technology going forward."

Tory Mazzola, a spokesman for Ensign, said the senator voted against a bill that included solar tax credits because of other provisions in the bill unrelated to solar that he said would have slowed domestic productivity. Mazzola said Ensign supports renewable energy and tax credits for solar.

Without all-important investment tax credits Nevada's solar economy will still grow, thanks to the politics of climate change and increasing fossil fuel prices, but at a much slower rate, according to David Hassenzahl, chairman of UNLV's environmental studies department. He compared the solar industry to the oil and nuclear industries, which would never have been profitable had they not long received huge government financial support.

"Government needs to intervene in (industries) with long-term payback and large public benefits," he said.

Resch said expanding the state's incentive program for residential solar installation would also stimulate the industry. Sierra Pacific Resources' solar rebate program, which helps residential customers, small businesses, schools and government agencies pay to install photovoltaic panels, is in its fifth year. There are a limited number of slots available each year, slots typically fill almost immediately and there is a waiting list for the program.

"I think you can say that Nevada has done a lot to bring investment in new (solar) manufacturing to the state. But in 2006 New Jersey installed 25 times more photovoltaic (solar) than Nevada," he said. "The reason: New Jersey provided the incentives to create a solar market."