Utah: Rising Storm for Net Metering

By SARA BALDWIN AUCK

After many slow-growth years, Utah’s solar market is finally starting to gain momentum. More Utahns than ever before are investing in solar energy for their homes, businesses, churches, government facilities, and schools. Yet, somewhat ironically, dark storm clouds loom on the horizon, threatening to put a real damper on Utah’s solar forecast. Joining the ranks of states battling to defend good rooftop solar policies, this year Utah is faces a two-pronged attack on its strong net metering policy.

As part of its recent 2014 General Rate Case application, Utah’s only investor-owned monopoly utility (Rock Mountain Power, or RMP) has requested that the Utah Public Service Commission (“Commission”) approve a new monthly fee of $4.25/month for residential customers with rooftop solar. RMP is also proposing an increase to the residential minimum bill from $7/month to $15/month and an increase to the customer charge from $4/month to $8/month – both of which pose additional economic challenges for rooftop solar customers. The General Rate Case process is expected to run through late Summer/early Fall 2014. This is the first time that RMP has requested to impose a special tax on net metered solar customers, who make up less than a quarter of one percent of RMP’s 850,000 customer base.

As the Commission considers this request, RMP is simultaneously working on legislation during the 2014 Utah Legislative Session that would, in effect, gut Utah’s strong net metering policy. Utah’s current net metering statute already allows RMP to put forth evidence before the Commission requesting changes and already allows the Public Service Commission to consider the evidence presented and evaluate the costs and benefits of rooftop solar. The statute was specifically crafted to protect citizens and businesses and allow for appropriate checks and balances in setting rates for customers with rooftop solar, while also not dismissing the values that distributed solar energy provides. By tinkering with an already sound policy (one that has never been put to the test) simultaneous with their Rate Case request, Rocky Mountain Power is seemingly seeking to change the rules in the middle of the game. If the legislation is allowed to pass, it would significantly undermine the utility ratemaking process and set a bad precedent for Utah, opening the proverbial Pandora’s Box for future ratemaking and monopoly utility regulatory processes.

For all the energy and effort this attack on solar is requiring, Rocky Mountain Power could instead be working proactively to modify their current business model to accommodate a more efficient, more resilient, and more state-of-the-art energy system. In the face of innovation and competition, Rocky Mountain Power could take this opportunity to look beyond the status quo and start transitioning to the utility of the future, considering new approaches that make way for a highly distributed energy landscape.

While still very far from tapping into its huge solar potential, improvements to Utah’s policies and rules over the years have laid a solid foundation for solar growth. Over the past decade, Utah’s installed solar capacity has grown exponentially from less than 10 kilowatts to over 20,000 kilowatts. To take drastic action and change our rooftop solar policy while Utah’s solar is in its infancy will pull the rug out from under Utah’s growing solar industry, paralyzing investment in one of the best clean energy resource we have.

For more information about Utah’s net metering efforts, contact Utah Clean Energy at info@utahcleanenergy.org.

sarabaldwinSara Baldwin Auck is  Senior Policy & Regulatory Associate at Utah Clean Energy.

 

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3 Responses to Utah: Rising Storm for Net Metering

  1. Mark Simone Reply

    February 13, 2014 at 4:24 pm

    $4.25 per month is a minor cost for a business or consumer for the use of the grid as their battery storage system. If it was $50 per month I would be right there with you. Utilities across the country are now battling this new paradigm which impacts their distribution loads and affects their efficiency programs.
    Utilities need to transform to a service provider with energy supplied from many sources including roof top solar. They are also interested in maintaining their revenues and decoupling could help in this process. Another area where utilities can improve is by offering real-time pricing for businesses and consumers.
    As utilities transform there will be less pressure on programs such as net metering and the solar industry can operate outside of the utility market.

  2. Jeff A Reply

    February 15, 2014 at 10:07 am

    I think slapping a fee on customers that have PV systems is the wrong message to send out to customers. It’s true that customers that have PV do need a bidirectional utility meter. These special meters do cost more than the standard electronic meters. Now if Power Company wants to charge a slightly higher rate for the meter rental that’s different. One of the issues I have with states that don’t have net metering laws is that the power company buys the PV power from the customer at the wholesale rate. This can be at as low 2 to 6 cents per Kwh in avoided cost. What the utility company does to a PV customer is install two meters one that measures the power the customer uses, and the other measures what the customer uses. Each meter charges a different rate. So excess power produce by the customer is purchased by the power company, and few hours later is purchased back by the customer at 4 times that it was sold for. Net metering laws do have a positive effect in encouraging customer based PV installations. Some utilities don’t pay the customers for excessive net metered power produced.

    I think rather a different approach should be taken. The utilities would be allowed to markup and resell net metered excessive PV power at a given rate. The utility could then start a green energy program that customers could sign up for. They could sign up for a given dollar amount, or a percentage of green energy they want to purchase for each billing cycle. The PV customers are happy, the Utility Company is happy because they are making money, and green minded utility customers are happy.

  3. Scotty Reply

    March 5, 2014 at 5:47 pm

    OK you people who design solar PV gear. How about a system very similar to a grid tie system, but no net meter. I keep my standard meter. There is a sensor on my power line that tells which way the power is flowing. When I start supplying power to the utility company, my system instead starts charging batteries so the net flow at the meter is zero. When the batteries are fully charged, the system cuts back to maintain zero net flow at the meter. When I start needing power the system first starts drawing from the batteries, once they reach a predetermined discharge, I begin drawing from the ‘grid’.

    My question is, would such a system be able to use a considerably smaller amount of backup batteries than an ‘off-grid’ system – thus making it more economical?

    I’m not using the utility co as a battery, I’m avoiding the rooftop solar ‘surcharge’ and i’m paying for the power I really use – no hassle, I’m a regular customer as far as the utility co. is concerned.

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