Gov. Hickenlooper signs 'Fair Permitting' solar legislation

HB 1199 promotes statewide economic development and prohibits excessive barriers and red tape that could slow Colorado's economic recovery. In Colorado, there is a need for certainty regarding the fees that can be assessed for permitting a solar energy system to save consumers and businesses money and to support job creation. Industry groups say the new law could become a national model for lowering solar fees and encouraging new jobs and investment.

Background:

In 2008, Colorado legislators passed SB-117, a successful bipartisan measure to prohibit excessive permit fees on solar installations to help promote economic development and job creation in Colorado - this legislation sunsets on June 30, 2011.

According to the U.S. Department of Energy, permit fees and regulatory costs nearly exceed the cost of solar modules, making it harder to achieve the economies of scale necessary to reach grid parity; the point where solar stands on its own without subsidies.

Permitting costs add about $2,516 per U.S. residential installation and can easily exceed $100,000+ for large scale installations due to wide variations in permit fees and processes, most of which do not improve safety.

Excessive fees can limit economic development and job creation within Colorado municipalities and counties - while solar costs have decreased significantly in the past three years (40-50% for solar electric technology) solar permit costs have increased for many customers in Colorado.

Colorado local permitting costs vary widely by governmental entity due to different permitting plan review processes and fees - this piecemeal approach can be costly for customers, complex and time-intensive - for example, last year state permit fees more than doubled in Colorado.

In 2007, local permitting and inspection added 13% to what a homeowner would spend on solar panels, today they add 33% -- countries like Germany and Japan have eliminated permitting for residential solar, handicapping the U.S. despite our superior solar resources.

What does HB 1199 do?

  • Extends the existing $500 cap on residential permit fees and $1,000 cap on nonresidential permit fees (or actual costs) for seven years
  • Permit fees for systems exceeding 2 megawatts are limited to a local government's actual costs

Why is HB 1199 necessary?
  • To reduce costs for customers, clarifies that the $500 cap on residential permit fees and $1,000 cap on nonresidential permit fees (or actual costs) applies to state agencies as well
• To promote transparency, clarifies that local governments and state agencies must clearly and individually identify all solar fees and taxes assessed on an invoice