KNOXVILLE, Tenn. -- The Tennessee Valley Authority is revamping its pilot Generation Partners program that encourages solar energy projects after a surge of requests from large commercial interests.

John Trawick, TVA senior vice president of commercial operations and pricing, told the Knoxville News Sentinel the program is returning to its original focus on small solar installations for houses and small businesses

Gil Melear-Hough, president of the Tennessee Solar Energy Institute, said the project is a victim of its own success.

There is a $5 million shortfall between what TVA pays Generation Partners participants for power and how much money is provided from Green Power Switch customers who agree to pay more to buy energy generated by solar, wind and biomass.

Currently, the Generation Partners program accepts projects that will generate up to 200 kilowatts of power a year, but after Sept. 16, it will accept applications only for projects generating up to 50 kilowatts, TVA spokesman Mike Bradley said.

Larger projects will be eligible for TVA's Renewable Standards Offer, which pays different rates for energy produced during peak-demand periods than for that produced during low-demand periods.

Generation Partners began in 2003 as a way to encourage customers to produce their own power using solar, wind and biomass technologies. Partners sell their excess power to the utility at a premium price. The program is designed to be paid for by Green Power Switch customers.

At one point, the demand for alternative energy was outpacing supply. In 2009, TVA expanded the pilot program to include systems that could produce up to 1 megawatt of electricity - about enough to power 1,000 homes. It also increased incentives and simplified the application process.

The result was a deluge of requests totaling $200 million.

The program was briefly suspended before it was restarted for projects generating 200 kilowatts or less.

The upcoming shift from a 200 kilowatt limit to projects that are 50 kilowatts or smaller will not affect the incentive levels Generation Partners will receive at least through the end of 2012, Bradley said.

Susan Curtis, TVA manager of end use generation for demand response, said that as of July 31 Generation Partners members had completed 619 projects producing 23 megawatts of power.

"We have 213 more projects approved and participating agreements signed, and those represent an additional 45 megawatts of solar, wind and biomass generation," Curtis said.

"As we go along, we are going to look at additional renewable energy options and try to transition from a pilot to a long-term program."