Detroit Edison has introduced a new program that could make installing a solar photovoltaic (PV) system almost twice as affordable.

Open to home owners and businesses, the newly created SolarCurrent initiative, announced this spring and officially open for business, will provide a one-time payment once the PV systems are up and running, and follow-up credits on each monthly electric bill for the next 20 years.

This is in addition to tax credits or cash incentives provided under the 2009 American Recovery and Reinvestment Act (30 percent) and any other state or local incentives – which in Michigan include a personal tax credit and a property tax exemption.

A utility-based PPA, or power purchase agreement provided for under Michigan’s 2008 Renewable and Efficient Energy Act (REEA), the SolarCurrent plan will provide cash and credit incentives to individuals and businesses that install solar energy systems, and allow Detroit Edison to capture the associated renewable energy credits, or RECs, delivered as a result.

The state’s REEA bill is multi-faceted “clean” energy legislation that creates a renewable portfolio standard, or RPS, for Michigan utilities of 10 percent of electricity sales from renewables by 2015.

Detroit Edison is hoping the program will attract more than 1,500 customers, and plans a second phase which will allow the utility to install large-scale PV panels on customer’s rooftops, or property, in exchange for long-term lease or rental payments. The program will fund up to $25 million in solar energy installations.

Solar photovoltaic systems are rated by the amount of energy they produce, a figure also based on solar radiation conversion efficiencies. A 6-kilowatt system, costing between $45,000 and $55,000 (or $7,000 per kilowatt) will produce about 20 kilowatt-hours per day, depending on the system’s efficiency rating.

The average American home uses about 1,000 kilowatt-hours a month. Paring this down via energy efficiency measures and smart-meter monitoring of appliances can trim this figure to about 800 kilowatt-hours a month, which means a 6-kilowatt system would meet about 75 percent of a home’s monthly needs. When such a system is grid-tied, much of the solar array’s production during the middle of the day – when solar radiation values are high and the inhabitants are at work or at school – goes back into the grid, unless battery backup is employed.

Under the state's current RPS, qualifying renewable technologies include wind, solar, landfill gas, biomass, anaerobic digesters, geothermal, hydroelectric dams, industrial cogeneration and gasification facilities, so this promotion of solar represents a significant step forward for solar generation in Michigan.