Programs

Kentucky renewable energy and energy efficiency

Kentucky offers a variety of incentive programs to encourage the adoption of renewable energy and the improvement of energy efficiency by individuals and businesses, which include grants, rebate and loan programs, tax incentives, and more.

A history of renewable energy and energy efficiency in Kentucky

In 2008, Kentucky enacted legislation that requires investor-owned utilities and electric cooperatives (exempting TVA utilities) to offer net metering to consumers with capacity up to 30 kW. Each utility's obligation to connect eligible customer generators is limited to 1% of the utility's single-hour peak load in the previous year. In 2019, Kentucky passed a bill (S.B. 100) that increases the maximum distributed renewable generation system size to 45 kW and requires the Kentucky Public Service Commission to set crediting structures for each utility based on dollar value rather than kWh netting. The bill goes into effect on January 1, 2020¹.

In 2008, Kentucky enacted legislation which requires that construction or renovation of public buildings for which 50% or more of the total capital cost is paid by the state must be renovated or designed to meet high-performance building standards. Additionally, all building leases for the state or any of its agencies must meet the new standards after July 1, 2018². Kentucky does not have an energy efficiency resource standard to require energy efficiency savings from utilities, but the state owns the nation's first net-zero energy-use public elementary school³.

The largest source of renewable energy in Kentucky is hydroelectric power, which provides about 6% of the state's electricity generation. Biomass accounts for 0.6% of the state's net generation. Wind power has limited potential for development in Kentucky, and currently no commercial wind power facilities have been built in the state⁴. Kentucky has 43.77 MW of installed solar power capacity from utility-scale and distributed solar power generation facilities, contributing 0.1% of the state's electricity generation. Bowling Green Solar Farm is the first utility-scale solar power generating facility in Kentucky. It has the capacity to generate 2 MW of electricity, which was completed in 2011 by developer SunDurance Energy⁵.

Kentucky's Renewable Portfolio Standard

Kentucky does not have a renewable energy portfolio standard or a voluntary renewable energy target.

Important renewable energy organizations in Kentucky

The Kentucky Public Service Commission was created in Chapter 145 of the Acts of the Kentucky 1934 General Assembly⁶. Kentucky has a regulated electric market. The Kentucky Public Service Commission is the administrative body that regulates the electricity rates of investor-owned utilities and electric cooperatives in the state. In addition, it is responsible for setting utility service boundaries, supervising construction and operation of utility facilities, enforcing compliance with service and safety regulations and so forth⁷.

The Kentucky Energy and Environment Cabinet oversees the regulation of energy and uses of the environment within the state. The Cabinet operates through four subsidiary divisions, including the Department for Environmental Protection, the Department for Natural Resources, the Office of Energy Policy, and the Office of Kentucky Nature Preserves⁸. Information on state government energy programs, policy, and energy-related data can be found on the website.

Utilities in Kentucky also play a significant role in advancing renewable energy and energy efficiency. There are 3 investor-owned utilities, 26 electric cooperatives and 20 municipal utilities in the state that supply electricity to customers⁹. Many of them provide residential energy efficiency rebate program to help customers reduce the cost. Eligible Technologies includes heat pumps, air conditioners, and the Energy Star Manufactured Home Program. Specifically, the Tennessee Valley Authority (TVA) is a corporate agency of the United States and it supplies electricity to 10 municipal and 5 cooperatively owned utilities in Kentucky. In terms of renewable generation in Kentucky, TVA operates one hydroelectric dam (Kentucky Dam) and a 41-kW solar site at Lovers Lane soccer complex in Bowling Green¹⁰.

Footnotes

1. DSIRE. “Net Metering”. https://programs.dsireusa.org/system/program/detail/1081. Accessed November 14, 2019
2. DSRIE. “Energy Efficiency Program for State Government Buildings”. https://programs.dsireusa.org/system/program/detail/2939. Accessed November 14, 2019
3. Forbes. “Net Zero Schools in Kentucky: Models for the Future Come from Surprising Places”. https://www.forbes.com/sites/peterdetwiler/2012/12/10/net-zero-schools-in-kentucky-models-for-the-future-come-from-surprising-places/#64b669c7456c. Accessed November 14, 2019
4. EIA. “Kentucky: Profile Analysis”. https://www.eia.gov/state/analysis.php?sid=KY. Accessed November 15, 2019
5. SEIA. “Kentucky Solar”. https://www.seia.org/state-solar-policy/kentucky-solar. Accessed November 15, 2019
6. Kentucky Public Service Commission. “History”. https://psc.ky.gov/Home/About#Related. Accessed November 15, 2019
7. Kentucky Public Service Commission. “About the Commission”. https://psc.ky.gov/Home/About#Related. Accessed November 15, 2019
8. The Kentucky Energy and Environment Cabinet. “About the EEC”. https://eec.ky.gov/About/Pages/default.aspx. Accessed November 15, 2019
9. EPA. “Energy Efficiency and Electric Infrastructure in the State of Kentucky”. https://www.energystar.gov/ia/partners/downloads/mou/state_resources/State_Profiles_Kentucky_508.pdf. Accessed November 18, 2019
10. TVA. “TVA in Kentucky”. https://www.tva.gov/file_source/TVA/Site%20Content/About%20TVA/TVA%20State%20Fact%20Sheet_KY.pdf. Accessed November 18, 2019