There are 21 operational residential and commercial solar energy systems in Morgan, Limestone and Lawrence counties, but local companies said solar parks still face obstacles in this region. Solar panels, which rely on sunshine for energy, are sprinkled throughout north Alabama.

Daikin America Inc. in Decatur has had solar panels for four years, an Elkmont solar park was under construction in December, and Joe Wheeler Electric Membership Corporation plans to add four more installations to its distribution system by the end of the year.

But solar power can’t compete with the utility companies in the area, as opposed to places such as Hawaii or in the Northeast where conventional power is more expensive and solar power is cheaper to produce, said Ron Hendershot, director of Daikin's Technical Center.“The economics won’t drive it in this area because of the cheap power,” Hendershot said.This area has some of the lowest power rates in the nation, Hendershot said. Decatur Utilities residential rates are about 9 cents per kilowatt-hour, and commercial rates are about 10 cents.

Daikin sells electricity to Decatur Utilities at 22 cents per kilowatt-hour through its nearly 770-panel solar installation, Hendershot s

Even with $300,000 from the federal government and about $100,000 from the state to help build the $1 million array, Daikin had to pay the remaining $600,000, Hendershot said.

It will take Daikin anywhere from 12 to 14 years to pay back its capital investment, he said.

“It’s not economically break-even. It just isn’t in this area,” Hendershot said. “Until we assess a full cost with fossil fuel, it’s going to be very difficult for solar to compete (in the near term).”

Solar energy development will remain slow until the cost of solar energy systems comes down, Hendershot said

State and federal government capital incentive programs for solar installations also affect solar energy growth, as well as utilities assessing and charging customers the true cost of power, which fluctuates depending on th

“Until then, I think all you’re going to see is small demonstration units that are motivated by some other reason (than profit),” Hendershot said.

Potential contracts soon could add 20 more solar projects to the area, Tennessee Valley Authority spokesman Chris Stanley said.

“We are seeing an increase in solar projects,” Stanley said. “Solar is an area that we’ve expanded recently (in) Alabama.”

The area’s sunshine and available land for solar fields create an advantage to solar-energy production, Hendershot said.

Compared to other renewable energy sources, solar is also more convenient and low maintenance, making it conducive to the area, said Sharon Lee, marketing director of Cantsink Manufacturing Inc. Cantsink, a Georgia-based construction company, will manage six of Joe Wheeler EMC’s solar projects upon completion of recently approved additions

“With solar, there are so many fewer parts,” Lee said. “It’s very reliable.”

The cost of solar energy production continues to drop as materials become cheaper, and as it does, the cost of generating solar energy will become more competitive with the amount charged for conventional power by local utilities, Hendershot said.

Joe Wheeler EMC is slated to have six or seven solar installations by the end of the year, each occupying 5 to 7 acres of land and each having the capacity to produce about 1 megawatt of electricity, said George Kitchens, general manager of Joe Wheeler EMC.

Joe Wheeler doesn’t put any funds toward the projects, Kitchens said. A third party builds and manages the fields that benefit the local utility sponsor and sells the energy to the TVA.The electricity Cantsink produces and sells to TVA is sold back to Joe Wheeler, Lee said.

Joe Wheeler is able to look at how the solar energy responds and reacts to its distribution system, but Kitchens said it wasn’t practical for the corporation itself to own solar power.

It would take about 18 to 20 years for the solar energy to pay back what it would cost for the corporation to do so, Kitchens said.

Solar power makes up about 2 percent of all the energy produced by Joe Wheeler’s system, Kitchens said.“It’s like we’re test-driving a car but not buying it,” Kitchens said.TVA’s interest in buying the energy is driving the growth of solar power fields in the area, Kitchens said.

Projects receive a retail rate set by the TVA board of directors, Stanley said, but the amount TVA pays developers for the energy varies depending on the scale of the system and the advancement of the technology.

In the United States, the amount of solar energy installed has increased from 1.3 gigawatts in 2008 to about 20 gigawatts as of the end of the first quarter of 2015, according to the U.S Department of Energy.

• [Editor:tianyawei]