Solar energy has a long history in Colorado, which is why it is one of 11 states where a debate is underway over the “true” value of electricity generated by rooftop solar power systems. The final decision will influence how power is generated and delivered across the state in the future and thus the price customers will pay for electricity.
What’s all the fuss?
The battle is over net metering, the mechanism allowing consumers to use energy when they need it, not just when it’s produced, by effectively selling energy generated by their rooftop solar panels back to the grid. Some utilities (including Xcel Energy) have not warmed to this idea, fearing that consumers will no longer need them.
After conducting a study on the costs and benefits of net metering, Xcel Energy Colorado submitted a proposal, the 2014 Renewable Energy Standard Compliance Plan, to the Colorado Public Utilities Commission (PUC) to trim the compensation paid to customers giving energy back to the grid.
The Proposal: While net metering advocates argue the credit is simply a fair payment for electricity put back on the grid, Xcel calculates that the contribution of rooftop solar users is not significant enough to avoid new transmission investments. Xcel is ultimately seeking to trim net metering credits down, but not eliminate them.
The Reactions: From the start, Xcel said the proposal was intended to spark debate about the impact of net metering. The proposal received major opposition. Xcel has been actively presenting a “by-the-numbers case” in the news while simultaneously threatening to scale back its Solar Rewards Program if the proposal is not approved.
The Implications: If the PUC approves Xcel’s plan, net metering will be rolled back across Colorado for all solar owners, no matter their utility company. A victory for Xcel won’t mean a reduction in rooftop solar installations, and this is where balance between the needs of both sides comes in. Xcel has been mandated to get 30% of its electricity from distributed sources by 2020 and Colorado has set a target for installing solar on 1 million rooftops by 2030.
This battle in Colorado shows that even utilities supportive of distributed solar are still struggling to define their value to rooftop solar owners. This is the reason Xcel is looking to restrict the parameters of net metering. Observers across the nation are watching Colorado to see how they calculate the value of rooftop solar and the value of utilities’ infrastructure.
We are seeing more buyers want to explore alternative energy when purchasing a home. If you have any questions about “green” features contact Daniel Beckerle, who is a certified Eco-Broker.
