What's Rooftop Solar Power Worth?
by Brian Maffly
As winter heads toward spring every year, the electrical output from the solar array atop David Bennett's Park City home climbs while his power usage declines with the lengthening days.
As a result, Bennett "banks" hundreds of kilowatt hours with Rocky Mountain Power to cover his power needs when the sunshine isn't pouring into his photovoltaic panels.
But on March 31, the end of the annual billing cycle, the utility zeroes out such "net metered" accounts, meaning these customers often forfeit a significant slice of their excess power. Bennett and other Utah solar-powered homeowners point to this annual gift to RMP to argue against its controversial proposal to impose a monthly $4.65 "facilities charge" on net-metered customers.
"This is such a blatant attempt to discourage future solar. It's scandalous," Bennett said.
But the utility says the expired credits are not much of a gift because the power Bennett and others produce on their roofs is of little use to the utility.
Less than .5 percent of RMP's residential customers, currently about 2,700, have net meters -- which measure both the power they pull off the grid and the excess solar power they put back in -- but the number is rapidly growing as the popularity of rooftop arrays grows.
With backing from state officials, RMP says the proposed fee would ensure such customers help cover the utility grid's massive costs that remain fixed regardless of how much power it moves. They avoid covering their share of maintaining this infrastructure by lowering their monthly bills, the utility argues. The Utah Public Service Commission (PSC) is expected to decide whether to approve the fee by early next month.
Clean-energy advocates have called on the commission to reject the fee, while local governments and political leaders have asked the three-member panel to postpone a decision until it conducts a meaningful cost-benefit analysis of net metering.
Salt Lake City Mayor Ralph Becker and other leaders contend the fees' proponents ignore the broad benefits solar power provides society and the environment by reducing the state's reliance on coal.
The utility, which claims such benefits are illusory, has framed the issue as one of "social justice," saying customers who cannot afford to net meter should not subsidize those who equip their homes with solar. Last year, net-metered customers put nearly 1 million kilowatt hours (kWh) into the grid. That's not much, equivalent to what about 100 Utah homes use in a year, said utility spokesman Dave Eskelsen.
But Eskelsen contends this electricity is not worth nearly as much as net-metered customers think, in part because the grid is designed for one-way flow of electrons. That limits how far the solar power they generate can be sent.
"They are talking about energy and we are talking about fixed costs," Eskelsen said, arguing net-metered customers receive a substantial benefit by being hooked into a grid they are not fully funding.
"They are virtually storing energy in the utility system and taking it in the following months when their system is not producing," Eskelsen.
"The rate at which they are being credited for the power they produce is three or four times its value to the utility. I understand emotions are running high, but belief is not evidence. They made an assumption about net meter installation that is unwarranted."
The utility argues that net metering benefits no one other than the solar-power customers who minimize their power bills. Rooftop photovoltaics do not offset the need to generate power at centralized plants or lessen pressure on the grid, RMP experts testified last week before the PSC.
However, the record reflects little effort to explore the potential benefits of net metering, according to retired regulator Judith Johnson, whose 13-year tenure with the Utah Division of Public Utilities spanned the wild price spikes of 2000-01. She argued rooftop solar can act as an invaluable hedge against fluctuations in the wholesale prices of power and fuels.
Price regulation is imprecise and based on averages, Johnson noted. Accordingly, no one expects rural customers to pay more for power, though servicing them requires greater infrastructure investments.
The same argument RMP is using to charge solar-equipped homes extra could be used against rural residents, as well as those who use less power either through efficiency measures or because they are too poor to own air conditioners and electronics, she told the commission Tuesday, when the panel heard six hours of public comments.
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