Making the Case for a Fair Solar Export Credit

Making the Case for a Fair Solar Export Credit
11 March 2020

Utah Clean Energy and other parties recently filed testimony with the Utah Public Service Commission in response to Rocky Mountain Power’s proposed 84% reduction in solar export credit rates. Our testimony made the case that solar rates simply cannot be quantified without considering climate and health benefits, the importance of grid flexibility, and job and economic benefits from rooftop solar.  A fellow solar advocate that works nationally, Vote Solar, recently concluded an independent solar study looking at these, and other benefits that rooftop solar brings to the grid.

Considering the Value of Rooftop Solar Benefits

Using data from thousands of local solar customers, Vote Solar recently completed an analysis of how rooftop solar energy exports interact with the grid, and nine different categories of associated costs and benefits.  They found that the value of excess energy that solar customers send back to the grid in Rocky Mountain Power’s Utah service territory is about 22 cents per kilowatt-hour.

This solar export credit value includes the benefits of avoided energy purchases, the only category considered in Rocky Mountain Power’s analysis. Vote Solar’s analysis also includes other categories of costs and benefits associated with operating the grid (such as avoided transmission and distribution costs) and community benefits such as reduced carbon emissions (CO2), local economic benefits, health benefits, and an array of other considerations that impact all Utahns.  While Utah Clean Energy has not yet completed our own analysis of Vote Solar’s testimony, we agree that a broader consideration of costs and benefits, including those that impact the well-being of Utah and our communities, must be considered when calculating the solar export credit.

Comparing Solar Export Credit Rates and Proposals

Residential Rocky Mountain Power customers pay an average of 10.2 cents for every kilowatt of electricity used. Homes installing solar today receive 9.2 cents in credit back for every kilowatt-hour of solar electricity they send to the grid. This simple billing arrangement allows rooftop solar owners to receive a financial benefit for solar that they don’t use, lowering energy bills and decreasing the payback period for solar.  

Utah Clean Energy is adamant that solar customers provide benefits to our larger energy grid, and that they should be compensated for those benefits. If Rocky Mountain Power’s proposed rate of 1.5 cents per kilowatt-hour is approved, rooftop solar development would be stopped in its tracks and Utah would miss out on the energy, resiliency, and environmental benefits that rooftop solar brings.  Not to mention the economic benefits and jobs that solar brings to our state.

This proceeding is expected to continue through the summer and conclude with a hearing in early October.  Utah Clean Energy’s team is now digging into all the testimony recently filed in this proceeding and will be submitting follow up testimony in July.