Thursday, March 6, 2014

IREC Regulators Guidebook to Distributed Generation

 IREC weighs in on the currently hot "value of solar" debate.  Are the utilities providing a subsidy to solar customers, or is it the other way around?

- Joy

There is an acute need for a standardized approach to distributed solar generation
(“DSG”) benefit and cost studies. In the first half of 2013, a steady flow of reports, news
stories, workshops and conference panels have discussed whether to reform or repeal
net energy metering (“NEM”), which is the bill credit arrangement that allows solar
customers to receive full credit on their energy bills for any power they deliver to the
grid. 2 The calls for change are founded on the claim that NEM customers who “zero
out” their utility bill must not be paying their fair share for the utility infrastructure that
they are using, and that those costs must have shifted to other, non-solar customers.
Only a thorough benefit and cost analysis can provide regulators with an answer to
whether this claim is valid in a given utility service area. As the simplicity and certainty of
NEM have made it the vehicle for nearly all of the 400,000+ customer-sited solar arrays
installed in the United States,3 changes to such a successful policy should only be made
based on careful analysis. This is especially so in light of a body of studies finding that
solar customers may actually be subsidizing utilities and other customers.

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