A remarkable turnaround is happening with Florida solar. And while it's still evolving, it's also eliciting concerns in a number of areas.

As recently as 2015, the Sunshine State was headed toward over-reliance on natural gas, according to the Union of Concerned Scientists. That year, utilities and solar advocates faced off over a ballot initiative on solar leasing which was defeated in the 2016 election. But then things changed.

Florida Power and Light (FPL), the biggest of Florida's three top investor-owned utilities (IOUs), is targeting over 8 GW of utility-scale solar by 2030. Duke Energy Florida (DEF) has committed to 700 MW and Tampa Electric Company (TECO) has committed to 600 MW, both by 2022. The Orlando Utilities Commission (OUC) has seen 150% distributed solar growth per year for the past four years.

And the state sees promise of even more growth, for distributed solar specifically. In 2018, the Florida Public Service Commission bypassed political turmoil and made solar leasing available to distributed solar customers who choose not to invest the upfront capital to own their arrays.

Florida's growth is the result of economic factors, customer demand and policies that support utility-scale solar, community solar and distributed solar.

Many are asking how big this boom will get, but a better question may be how this growth will evolve as its impact sparks responses by utilities, solar developers and policymakers.

Growth by the numbers

In the once anti-solar Southeast, Florida led a 65% solar growth surge in 2018, reaching 2,215 MWs, according to the Southern Alliance for Clean Energy's (SACE) Solar in the Southeast report.

North Carolina ranked second nationally at 5,261 MW and other southern states trailed not far behind, with Georgia ranking 11th and South Carolina ranking 18th, at 1,571 MW and 662 MW, respectively.The region's 10,579 MW will near 20,000 by 2022, according to SACE.

Florida "is the headline state in the Southeast this year" and "will have built more solar than North Carolina by 2022," SACE Solar Program Director and report lead author Bryan Jacob told Utility Dive.

Because community solar and distributed solar are just beginning to emerge in Florida's market, utility-scale solar accounts for about 88% of the Southeast's installed capacity, Jacob said. Four of the region's seven utility growth leaders are in Florida — FPL, TECO, OUC and Jacksonville Electric Authority (JEA) — and are expected to lead through 2022, SACE reported.

Utilities in Florida are leading the scale-up in the Southeast, Jacob said. "And FPL's 2019 commitments will make it a leader for the next decade and make Florida a key story this year."

Utility-scale solar

"Florida utilities are doing solar in many different ways," Vote Solar Southeast Director Katie Ottenweller told Utility Dive. "And best practices are emerging."

Cost was a main driver for utilities, in part supported by the Solar Base Rate Adjustment, which allows utilities to recover costs through rates. Though controversial because it has limited private sector growth and allowed utilities to dominate deployment, "it catalyzed solar growth in Florida," Jacob said.

Many utilities also take advantage of the Florida Power Plant Siting Act's under-75 MW threshold, which reduces utility costs through streamlined permitting.

An emerging consideration for utilities is how to ensure reliability as they add more variable generation into their resource mixes. Many are adding battery storage to their existing portfolios and have proposed natural gas generation in their long term planning.

FPL has built 11 projects and will finish four more in 2019. Its "30 million solar panels by 2030" goal, announced in 2019, would have an estimated 8,128 MW online in 2028, making solar about 20% of its portfolio.

"I started a wall map of our solar sites, but we have built so much that I need a new map," FPL spokesperson Alys Daly told Utility Dive.

The utility is also developing its first Energy Storage Center, a 409 MW solar-adjacent installation that is planned to come online in late 2021.

TECO said that its 600 MW by 2021 will give it the highest percentage of solar generation of any Florida IOU at approximately 7% and DEF is planning to invest an estimated $1 billion to "build or acquire" 700 MW of utility-scale solar and 50 MW of storage by 2022, according to Duke spokesperson Ana Gibbs.

Finally, JEA is planning 250 MW of projects that will bring the utility's current 39 MW of installed solar capacity to about 300 MW, JEA VP Steve McInall told Utility Dive. And OUC will more than triple its current 30 MW capacity by taking 108.5 MW of a 250 MW Florida Municipal Power Agency procurement, according to OUC Manager for Emerging Technologies and Renewables Sam Choi.

To meet the challenge of integrating variable generation, JEA is planning to use existing natural gas but said it would also "see where prices are" for batteries, according to McInall.

But utility-scale solar is not the only way Florida's utilities are expanding. Their variety of community solar programs should make the state a real-time laboratory for program design over the next few years, Jacob and Ottenweller agreed.

Community solar deployment and barriers

TECO's 17.5 MW Shared Solar proposal, though far from ideal, may be the most interesting Florida IOU community solar programs right now, Jacob said.

The project is awaiting PSC approval and would replace the current $0.05/kWh fuel charge with a fixed $0.063/kWh charge. But if TECO's fuel costs rise above the charge, as anticipated, customers would reduce their electricity bills through the difference between the fuel cost and the subscription price. Monthly subscriptions of 1,000 kWh blocks, up to 100% of usage, give customers flexibility in participation if their circumstances change or fuel costs don't increase.

That would make it the only community solar offering by Florida utilities that allows both a potential bill saving attached directly to the utility's fuel cost and the flexibility for customers to exit the program at the end of a monthly billing cycle if they are dissatisfied with participation.

Other programs include FPL's 1.49 GW Solar together program, which would credit customers $0.034/kWh for the output of the kWs for which they subscribe​, escalating the credit rate 1.45% annually, according to FPL's filing. There is also DEF's Shared Solar program, which gives customers a $0.13/kWh extra charge for solar-generated electricity added to DEF's system.

JEA also offers premium-priced subscription, but replaces the customer fuel charge with a subscription rate likely to fall below the retail electricity rate because solar's cost is dropping, JEA's McInall said. As a result, "we expect to subscribe almost all the 250 MW we are adding," he said.

These utility-led programs open the door to community solar in Florida, though private sector community solar developers' opportunities are limited to partnering with utilities to build projects or acquire subscribers. Until Florida enacts comprehensive enabling legislation, competitive offerings from private sector community solar developers won't be available.

While utilities' existing net metering compensation to solar owners for the generation their systems send to the grid and the new solar leasing policy are adequate growth drivers, necessary policy support for private sector-led community solar has not been effectively addressed.

"Florida utilities have recognized the pent-up demand for community solar," Coalition for Community Solar Access (CCSA) Executive Director Jeff Cramer told Utility Dive. "But there is no opportunity for private sector community solar developers."

Without a competitive market, Florida will not see the same low costs to customers and grid stabilization that has come from programs in other regions, Cramer said.

Policymakers need to understand that a utility-led program created through the regulatory process is only one of two ways to grow community solar, Cramer said. "A stakeholder-driven, legislative process can implement a community solar policy [and provide] opportunities for both utilities and private sector developers to meet the demand the utilities have demonstrated is there."

The benefits Cramer suggests can be won for community solar with policy reform are expected to be demonstrated by Florida's recent success at addressing a significant policy barrier to distributed solar growth.

Removing distributed solar barriers

The major remaining policy barrier for distributed solar in Florida was addressed in 2018. After the ballot initiative fight in which competing proposals from solar advocates and utilities for solar leasing defeated each other, Sunrun worked with the PSC to get leasing approved last year, Sunrun Director of Public Policy Tyson Grinstead told Utility Dive.

Though it is too soon to have validating data, leasing will likely soon have "a big impact on Florida's distributed solar market," North Carolina Clean Energy Technology Center (NCCETC) Senior Manager of Policy Research Autumn Proudlove told Utility Dive. NCCETC has documented national solar policy since 2014.

"Florida already had a strong net metering policy," Proudlove said. With leasing, which allows customers to acquire distributed solar arrays without upfront costs through long-term contractual commitments, "the policies driving growth in other markets are now in place," Proudlove said.

DEF's overall five-year 750% growth and OUC's four year 150% yearly growth showed there was already demand for distributed solar. And it is not slowing. "DEF is interconnecting 400 residential and business solar customers per month," Duke's Gibbs said.

FPL has over 10,000 net metered customers and the number is also growing, FPL's Daly said. Tampa's distributed solar retail net metering customers grew from 1,100 in 2016, to 1,800 in 2017 to nearly 3,600 in March of this year, Jacobs said.

But it is possible solar markets have stages in which growth like Florida's leads to new concerns, some solar advocates said.

From staged to sustained growth

Both Sunrun's Grinstead and NCCETC's Proudlove said South Carolina's House Bill 3659 is an example of how solar policy can evolve. The bill addresses issues left unresolved by previous solar legislation, like limits on net metered solar and enabling community solar legislation.

"Policies that jumpstart state solar markets are often followed by concerns about cost shifts or grid stability that create stakeholder debates and slow growth until they are resolved with cost-benefit studies and new policies," Proudlove said.

Those concerns are emerging in Florida.

SACE would like to see controversial regulatory reform of the utility-scale solar solicitation process, Jacob said. OUC is considering controversial measures that address grid stability, including utility ownership of distributed solar assets, Choi said. And debates are emerging over net metering compensation, caps on rooftop system size and utility interconnection procedures, according to Grinstead.

It is not clear whether these concerns will evolve into policy debates or whether such debates would affect Florida's solar boom. But it is clear the circumstances that led to the boom are changing.

"Now that solar is the cheapest resource, we need to look beyond individual programs and consider the whole system and how to maximize solar's benefits for everyone," Vote Solar's Ottenweller said. "There is enough experience with different utility approaches to inform a discussion that could be a real gamechanger."