The past few years have been amazing for solar in the U.S. New capacity added in 2012 grew by 76 percent over the previous year. NREL recently estimated that the US has the potential to meet 20 percent of its total electric demand with solar. This estimate is becoming prophecy as prices continue to drop, falling by 58 percent just since the beginning of 2011.
Yet, despite all of the great news, solar still only provides one percent of the total U.S. power demand.
So why, if the potential is 20 percent, are we only at one percent?
Cloudy Germany has achieved 22 percent solar penetration, with government assistance in the form of feed-in tariffs, a guaranteed rate that solar power can be sold back to the utilities for.
Here in the U.S., we don’t have the political will to take that approach. And with prices coming down so rapidly, it might not be necessary. Why, then, is it coming so slowly?
One big roadblock is the availability of financing. People are interested in going solar, but they don’t have a way to pay, especially post-meltdown, when banks are reluctant to lend.
Some utilities, in places like Hawaii, are beginning to offer on-bill financing, where the cost of installation is amortized by the utility and paid for by the energy savings realized. But not all utilities are willing to carry the risks of such a program. Funding for projects of this size, in many places, can be difficult to find.
Last year, Mosaic announced a funding opportunity that they estimated could be worth a potential $90 billion, if participation reached one percent of the retail investment market. They act as an intermediary, gathering capital from many micro-lenders who are willing to invest in their communities and their future.
Mosaic claims that they were inspired by crowdsourcing pioneer Kiva, who with their extensive lending community, 900,000 strong, accessible by anyone with Internet access with $25 or more to lend, can join. Kiva is currently distributing some $2.2 million in loans per week with a total of $420 million since they started in 2005. Kiva’s website matches up borrowers with lenders looking for a project to support. Kiva’s repayment rate of 98.9 percent compares favorably with the national average 96.5 percent bank card rate and edging out the national composite rate.
Now, Kiva is announcing a new crowdfunding program, specifically for renewable energy. How many times have you wished you could do more to help reduce the impact of climate change but didn’t feel you could afford to take a major step like putting solar panels on your house? Or perhaps you live in an apartment building but still want to do something?
I love what Premal Shah, Kiva President and co-founder said earlier this week. “Our environment is a shared public trust belonging to everyone, the responsibility to protect that trust is also shared. We can take steps to protect our environment by changing our own behavior, but the reality is that clean renewable energy is out of reach for the vast majority of those who need it most.”
The new crowdfunded Green Loan program already has helped more than 2,600 people in 21 countries. These loans are used by borrowers specifically for things like:
- installing solar lighting systems
- purchasing clean cookstoves
- distributing renewable energy products in isolated regions
- making household improvements to reduce energy costs
- implementing sustainable agricultural practices
Each of these loans was crowdfunded, $25 at a time, by 57,000 Kiva lenders from 91 different countries. It shows that caring and sharing can be a sustainable model and a compelling mission shared around the world. The program has been so successful that, at the moment, all borrowers have been funded.
Crowdfunding gives people a way to be a part of building a better world in a manner that they can afford. In a way, it’s a bit like a mutual fund, where a lot of folks put a small amount of money in to invest in various stocks for their own gain, only this is where people pool their money to finance a solar project for those who couldn’t afford it otherwise. Only they are helping themselves as well, by helping to build a cleaner, better future for all, plus getting their money back with interest at the same time.
The idea of solar crowdsourcing isn’t new. One Block Off the Grid did this a couple of years ago, pooling together people by geography in an effort to leverage group purchasing power, while at the same time, raising people’s awareness of their local government’s policies towards clean energy. And while micro-loans were not involved, all profits were donated to Kiva City small business programs.
So coming back to the original question, will this help up bring solar energy up to scale?
With prices coming down, and more money pouring in, it seems now to be only a matter of time.
RP Siegel, PE, is an inventor, consultant and author. He co-wrote the eco-thriller Vapor Trails, the first in a series covering the human side of various sustainability issues including energy, food, and water in an exciting and entertaining format. Now available on Kindle.
Follow RP Siegel on Twitter.