by Shane Henson — June 6, 2011—As part of the Obama Administration’s SunShot Initiative to make solar energy cost-competitive with fossil fuels within the decade, U.S. Department of Energy Secretary Steven Chu announced the availability of more than $27 million in new funding to reduce the non-hardware costs of solar energy projects, a critical element in bringing down the overall costs of installed solar energy systems.
The funding will also support a $12.5 million “Rooftop Solar Challenge” to encourage cities and counties to compete to streamline and digitize permitting processes. This challenge incentivizes local governments to develop innovative solutions in four key areas: standardizing permitting processes; updating planning and zoning codes; improving interconnection and net metering standards; and increasing access to financing. Just as important, $15 million has also been made available to advance innovations in information technology systems, local zoning and building codes and regulations, and more.
Both funding opportunities focus on reducing “non-hardware balance of system” costs, which generally refer to the costs of installing solar systems not associated with the solar panels, mounting hardware, electronics, etc. These “soft costs,” including the capital required to pay for siting, permitting, and installation, as well as the cost of connecting the systems to the grid, can represent up to 40 percent of the total cost of the solar energy system.
