Duke Energy Florida unveils $1 billion plan to expand solar power

Small businesses and homeowners could get monthly subscriptions to access solar energy, under a new proposal from Duke Energy Florida.

The company plans to spend $1 billion on new solar energy plants across Florida, if its new Clean Energy Connection program is approved by state regulators. The CEC program would provide about 750 megawatts of solar power by 2024. That would more than double Duke's current plan to have 700 megawatts of solar power in place by 2022.

Catherine Stempien, Duke Energy Florida state president, said the program would expand solar options.

"The Clean Energy Connection Program is delivering on what our customers want — affordable clean energy options. It will be a measurable way for customers to share in reducing carbon emissions," Stempien said in a news release. "We know that larger-scale solar is the most cost-effective way to get the benefits of solar on our entire system and this program gives customers, especially those who may not have the ability to install solar at home, a compelling alternative to rooftop panels."

The proposal has drawn corporate support from Walmart (NYSE: WMT) as well as Southern Alliance for Clean Energy and Vote Solar, according to Solar Power World. Ben Pratt, senior vice president for government affairs at crop nutrient firm The Mosaic Co. (NYSE: MOS) in Tampa, described the CEC as "an innovative approach," and St. Petersburg Mayor Rick Kriseman called the CEC plan "another step in the right direction."

"Our initial subscription represents our commitment to work with DEF and others in the state for more ambitious renewable energy goals and a just transition to clean energy," Kriseman said in Duke's news release.

Under the proposal, customers could subscribe to blocks of solar generation equivalent to 1 kilowatt (kW) of solar power per block and get bill credits in return.

The monthly subscription fee would be $8.35 per kW. A customer who uses about 1,000 kW hours per month would need to subscribe to about 5kW to cover their full usage, Duke said. The customer would get a bill credit each month based on subscription size.

For the first few years of enrollment in the program, participants would expect a monthly net charge, with the subscription fee outweighing the bill credit. The fees and credits would balance each other out after about five years, and after about seven years, the credits would exceed the fees, Duke said on its Clean Energy Connection website.

The program also sets aside 26 megawatts for low-income customers, who would see guaranteed savings on their monthly bills, Duke said.

If approved by the Florida Public Service Commission, the program will open to residential and small businesses for enrollment in 2021 with the program beginning to generate power at the beginning of 2022.

Duke Energy Florida, a subsidiary of Duke Energy (NYSE: DUK), serves about 1.8 million customers throughout the state.

The company unveiled its plan shortly after the Florida PSC, which regulates utilities statewide, issued a report saying consumer confidence in generating and using renewable energy continues to increase.

The PSC said there was a 57 percent increase in customer-owned renewable generation installations, rising from 37,862 interconnections in 2018 to 59,508 in 2019. Solar photovoltaic panels continue to be the most popular renewable choice, the report said.

The PSC adopted a net metering rule in 2008 that was designed to make it easier for customers to interconnect their systems with the utility's grid. That rule established a billing mechanism that allows customers to offset their usage through the self-generation of energy, with any excess energy delivered to the grid being applied as a kilowatt-hour credit to the customer's monthly energy usage, according to the PSC.

Duke Energy Florida, Tampa Electric Co. and other investor-owned utilities are required by the rule to offer an expedited interconnection agreement process so that homeowners and businesses interested in generating their own energy can do so quickly and safely, the PSC said.