Perhaps it's appropriate that President Obama left Washington and traveled to a Florida solar power plant recently to announce federal dollars for a new national "smart grid." It's the states that have so far taken up the policy mantle of making renewable energy pay off for small producers.

Nearly every state rewards users of solar panels, wind turbines and other renewable technologies with credits on their electric bills or by paying them for the excess electricity they generate. Some observers say these steps will help prime the rest of the country to go a step further and embrace "feed-in tariffs" at a federal level.

Feed-in tariffs encourage consumers to produce their own power by requiring utility companies to buy their excess at better than market rates. The policy has had success in growing renewable industries, especially solar, in other countries, and a handful of states have adopted it, most recently Hawaii last week. Last year, Rep. Jay Inslee, D-Wash., proposed a national feed-in tariff; it didn't make it out of subcommittee, but this year, Inslee and prime co-sponsor Rep. Bill Delahunt, D-Mass., plan to reintroduce the bill before Thanksgiving.

Inslee's and Delahunt's offices say last year's bill fell short because lawmakers didn't know enough about how feed-in tariffs worked; this year, the pair have tried to sell their colleagues on the benefits. Even now, Inslee and Delahunt concede that the bill is unlikely to make it into law, but they say it pushes the conversation forward, educates policymakers and could influence a discussion about how American industry can adopt aggressive renewable energy standards.

The Waxman-Markey bill, currently moving through the House, contains a national renewable energy portfolio standard that would require 25 percent of energy from utilities to come from renewable sources by 2025. Inslee argues the bill's cap-and-trade program would be complemented by feed-in tariffs.

Many European countries have national feed-in tariff laws, but they've had the greatest effect in Germany. With payments to power generators set at four times the retail price, the solar industry exploded. Renewable energy now accounts for 12 percent of Germany's electricity consumption.

But it was an expensive investment for the German government, and most agree that model would be politically difficult in the United States. When California enacted a feed-in tariff law last month, its sponsor took note. "We wanted to differentiate with Germany's model," said Vince Marchand, a consultant to state Sen. Gloria Negrete McLeod, who sponsored California's bill. "There is a little bit of consciousness of what this was going to do to ratepayers.... That was a gift to solar developers."

Under the California model, the energy producers are paid by the utilities, which make up the money in higher rates to non-producers.

When the Golden State passed its original feed-in tariff law in 2006, it found that keeping prices tied too closely to the retail rate failed to spur investment in renewable energy. But when prices are set too high, as they were in Spain in 2007, demand is so high that the government can't keep up. Spain's nationwide cap of 400 megawatts of solar energy was reached within a year, and the country subsequently suspended its program. Marchand hopes California's new rate will break 20 cents per kilowatt hour, almost double what customers pay for utility-generated power.

The primary goal of California's new feed-in tariff was to achieve a balance that would get solar and other renewable projects built, Marchand said. It sets the rate at the market price reference for fossil fuels, plus an additional amount that would take into account the intangible benefits of renewable energy, including reduced greenhouse gas emissions, improving air quality and other environmental offsets. The California Public Utilities Commission is tasked with setting the rate.

California has long been regarded as a leader in progressive environmental issues. In 2002, the state created a program to reach a goal of 20 percent of all electricity coming from renewable sources by 2010. In 2008, the governor issued an executive order raising that cap to 33 percent by 2020. Currently, it has reached 10.6 percent of electricity generation from renewables. "California's aggressive renewable portfolio standard is pushing utilities to be able to live with a higher rate," Marchand said.

But the CPUC is less enthusiastic and didn't support the feed-in tariff legislation. It argues that setting the price through an administrative process based on the market rate for electricity, as this bill does, won't guarantee that the price will work to encourage investment. In its own proceedings, the CPUC is looking into structuring rates based on the cost of technology, though it has not yet made a final decision. The other costs are made up in small increases in costs to non-solar ratepayers.

Utilities argue that paying solar customers too much hurts those without solar by paying them for more than they put into the system. And those opposed to the system say paying customer-generators the full retail rate is overvaluing their contributions. The retail price accounts for the power generation and then its transmission and distribution; solar owners are providing only generation.

"It's not so much a question of increasing costs, but it's a concern of shifting costs," said Jim Owen, spokesman for the Edison Electric Institute, the largest shareholder-owned electric companies association. "It's a question of making sure that the net metering regulation or law, or whatever, is properly designed so that everyone is treated equally." EEI supports renewable energy, but it wants legislation to remain at the state level. Renewable energy production, because it varies geographically in cost, and applicable technology, is better dealt with at a local level, Owen said, compared to the reduction of greenhouse gas emissions, which is a national issue and thus should be dealt with on a national scale.

A national program would have to be based on more than encouraging clean energy, said Sue Kateley, executive director of California Solar Energy Industries Association, which partnered with Negrete McLeod's office to sponsor the legislation. The German program "was created for reasons beyond electricity creation," she said. "It was job creation... [the] purpose of German feed-in tariff being that high was to give a jumpstart to the industry."

Inslee maintains that the feed-in tariff mechanism is the "most economically beneficial, most efficient" way to incentivize renewable energy development quickly. He modeled his national feed-in tariff legislation on Germany's system, and touted the success of the European feed-in tariffs when he introduced his bill in 2008. The bill mandated that utilities purchase power generated from renewable sources at a "uniform national rate." This would include the amount needed for development plus a "reasonable profit" given the technology used, when the system was installed and the size of the facility.

Feed-in tariffs are already getting more national attention as states roll out less complicated "net metering" policies, says Karlynn Cory, senior energy analyst at the National Renewable Energy Laboratory. Net-metering laws already exist in 42 states and the District of Columbia, and three more states have individual utilities that offer them. Unlike feed-in tariffs, the intention of net metering laws isn't to make a profit. Instead, customers earn credits on their bills or are refunded by utilities if they consume less energy than they make.

Cory noted that Ohio, a state with strong coal interests, doesn't set a limit for the size of a facility that qualifies for net-metering. "There has been a lot of interest in expansion in the last couple of years to make the program bigger to boost the total program size for net metering, as well as the maximum size for each project across the U.S.," Cory said.

Combined with other policy incentives, like the proposed national renewable energy portfolio standard, the groundwork is being laid for increasing interest in feed-in tariffs as renewable energy gains national attention. She expects that "feed-in tariffs are only starting in the U.S."

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