The Future of Net Metering
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The Future of Net Metering Solar Power International Chicago, IL Jason B. Keyes October 22 & 23, 2013 The image cannot be displayed. Your computer may not have enough memory to open the image, or the image may have been corrupted. Restart your computer, and then open the file again. If the red x still appears, you may have to delete the image and then insert it again.
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A growing number of utilities are calling for reform or abolition of net metering. They call it a “free ride” to use utility wires and not pay for the service. IREC, along with other non-profits and the solar industry, know net metering can be fair and balanced. It provides benefits that outweigh utility costs in most cases, particularly by deferring new utility construction. It's a hot button topic. A rundown of what's happening in key states, including a deeper analysis of the issue and insight into how to achieve a fair valuation of all of net metering's benefits, was covered by Jason to standing-room crowds
Transcript of The Future of Net Metering
The Future of Net Metering
Solar Power International Chicago, IL
Jason B. Keyes October 22 & 23, 2013
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Definition
Net metering is a billing mechanism that credits solar system owners for electricity exported onto the electricity grid. Under the simplest implementation of net metering, a utility customer’s billing meter runs backward as solar electricity is generated and exported to the electricity grid and forward as electricity is consumed from the grid.
Net metering includes this . . .
Courtesy SolarCity
and this . . . .
Courtesy SolarCity
and, in some sense, even this (Nellis AFB)
Key Parameters
• Facility Size
• Program Cap
• Fees
• Third Party Ownership
• And – sunshine, utility rates, incentives, interconnection procedures
Net Metering Facility Size Caps www.dsireusa.org / July 2013
43 states, + Washington DC
& 4 territories have adopted a net
metering policy.
State Policy
Voluntary Utility Program(s) only
U.S. Territories
www.dsireusa.org
< 1 %
< 3 %
< 5 %
≥5%
Unlimited
DC
Net Metering Program Caps (percent of utility peak demand)
Retail Power Purchase Agreements
Status unknown or undetermined
Authorized by state or otherwise currently in use (see notes on following slide)
Apparently disallowed by state or otherwise restricted by legal barriers
Currently under judicial or other form of legal review
RI: May be limited to certain sectors
UT: Limited to certain sectors
AZ: Limited to certain sectors
September 2013
2013 Net Metering Grades (www.freeingthegrid.org)
• 2007 • 2008 • 2009 • 2010 • 2011 • 2012 • 2013
NET METERING
FILTER NET METERING BY…
A B C D F N/A
DC
Obstacles to NEM Program Expansion
• Concerns about cost – Utility claims of cost shifting to non-NEM customers
– Competing valuation studies
• Concerns about safety and reliability – Shift discussion to interconnection procedures
– NEM is just a billing arrangement
Net metering is a “disruptive challenge” that is leading to “declining utility revenues, increasing costs and lower profitability potential” that must be addressed.
Edison Electric Institute
Next Steps
• Valuation Studies – See IREC’s new “Regulator’s Guidebook” (www.irecusa.org)
– Need to validate NEM cost-effectiveness
– Need to include all benefits
• Rate Design – Action shifting to rate design in utility rate cases
– Need to be involved in each major case – huge cost
• Alternative Models – Value of Solar Tariff, Feed-in Tariff, shared solar
Next Steps
Valuation Studies
Valuation Highlights
• Energy value – natural gas not burned
• Capacity value – natural gas plant not needed
• Line losses – megawatts not lost on T&D lines
• Utility environmental – avoided compliance costs
• Ancillary benefits – grid support
• Market price impacts
• Societal benefits – jobs, health and environmental
Avoided capacity costs visualized
FL and TN: TVA and other utilities
considering VOST approach
NV: PUC opened docket 13-07010 to consider costs and
benefits of NEM
VT: 2012 legislation directed the VT PSB
to complete an evaluation of NEM
MN: 2013 legislation required development
of a VOST
AZ: ACC considering APS
NEM proposal and cost/benefit studies
CA: 2012 legislation required a CPUC study of
costs and benefits of NEM
CO: PUC considering Xcel cost/benefit study
of NEM
TX: Austin Energy developed a VOST in 2012; San Antonio’s CPS will be
replacing NEM with a SunCredit tariff
NC: In docket No. E-100 Sub 136,
NCUC is examining avoided cost methodology
SC: PSC considering a NEM docket that
addresses cost issues
WA: Docket UE-131883 has info on an upcoming
workshop to discuss costs and benefits of DG
LA: In docket R-31417 PSC staff proposed to value NEM exports at avoided cost.
MI: VOST issues have appeared in RPS proceedings
OR: PUC recently held a workshop to discuss solar rates in docket UM 1452
HI: NEM cost benefit analysis
funded by NARUC due out shortly
THANKS to our generous sponsors for the 2013 3iForum and 3iAwards
