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Solar benefits — Should Utah solar owners be paid 50 percent more?

By July 28, 2016 No Comments

2016 has already proven to be a banner year for rooftop solar installations. With all the education, lowered prices for the systems themselves and the proven cost-benefits to moving to solar, Utahans seem to be jumping head-first into this financial decision and with good reason.

With all of these reasons, one could conclude that this decision is a no-brainer, right? Surprisingly, it’s not. There are still a lot of myths surrounding solar rooftop installations, one, in particular, being the regulations and rates that state and utility companies impose upon the consumer.

Kelly Curtis, Director of Operations at Solaroo Energy joins us today to discuss the net-metering benefits and if Utahans deserve more compensation than they are currently receiving.

Nationally, the majority of states have mandated net metering rules, Utah included. The question then should be: how does one put a fair value on the amount of solar power generated through this grass-roots means? This source of energy is obviously disrupting the traditional utility business model and therefore requires a way to show value against the cost of managing these independent systems. In other words, is rooftop solar going to put an unfair burden on non-solar customers?

Brookings.edu reported, in May of this year, that several independent studies have come forward with a statewide “value of solar” methodology that can be measured across each state to show the value of net metering. They even cited the study that the Lawrence Berkley National Lab conducted on whether the use of net-metering impacts the utility consumer and how. Surprisingly, they found that “net metering is more often than not a net benefit to the grid and all ratepayers.”

According to Brookings, “… by the end of 2015, regulators in at least 10 states had conducted studies to develop methodologies to value distributed generation and net metering, while other states conducted less formal inquiries, ranging from direct rate design or net-metering policy changes to general education of decision-makers and the public. And there is a degree of consensus. What do the commission-sponsored analyses show? A growing number show that net metering benefits all utility customers.”

Mr. Curtis comments, “It’s just nice to see. At first, the utilities wanted to study the cost of solar in order to charge solar customers extra fees, but the more studies that come out, the more of a consensus is forming that solar is a benefit, and solar customers should be compensated even more.”

For example, in states like Vermont, Nevada and Mississippi, studies all showed more benefits to net-metering than any disadvantages. Benefits such as fewer costly grid updates and significant infrastructure investments, taking pressure off the state’s oil and gas generation at peak demand times and ultimately, lower rates.

With all of these advantages and the methodology in place, states still vary in the amount a solar consumer is paid, in credits, for their solar generation. In Massachusetts, the value of solar exceeded 22 cents per kWh of value. In New York, consumers can receive between 15 and 40 cents per kWh. Studies, concluded, however, that on average the median value of solar power across all 11 state-wide studies was nearly 17 cents per kWh to the grid, which is nearly 50 percent higher than the compensation Utahans receive for their solar generation and the national cost of electricity of 12 cents per kWh.

Installing panels

Mr. Curtis adds, “The problem with having utilities do their own studies is that they only take into account some of the benefits, not all. They want the numbers to turn out a certain way. But when you look at the unbiased studies done by states or independent agencies, the specific valuation might differ, but they almost all say that solar is a net benefit and that solar should be valued more than it currently is.”

Curtis continues, “Studies like the Brookings Report show that the future in rooftop solar is bright, and there is enough momentum now to appeal to the mainstream market.”