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Utah's fierce-if-wonky debate over rooftop solar resumed this week before the Public Service Commission, which heard three days of expert testimony and public comment on costs and benefits associated with Rocky Mountain Power's net-metered customers.
This small, but growing, number of ratepayers reduce their utility bills by generating excess power when the sun is out, which they get credited for when they draw power at night.
Utah's largest utility says its solar-equipped customers are mooching off the system by not covering their share of the electrical grid's fixed costs.
But an independent study commissioned by proponents of renewable energy found that every dollar invested in rooftop solar results in a benefit worth $12 to $24 for all the utility's customers. This is because such "distributed power generation" reduces the need to build costly centralized power stations in the future, according to an analysis conducted by Synapse Energy Economics.
"Utility energy efficiency programs [by contrast] generally have a benefit of $1.50 to $3.50 for every $1 invested. You don't have to be a fan of clean energy to see the economic benefit here," said Sarah Wright of Utah Clean Energy, which commissioned the study to advance its case that the Public Service Commission (PSC) should not impose surcharges or higher rates on net-metered customers.
On Tuesday, Synapse principal Tim Woolf explained how his study assumed 1 percent of RMP customers will install rooftop solar each year for a decade, making 10 percent of customers net-metered by 2024. This move would avoid costs for the utility totaling $287 million to $1.2 billion, costs that would otherwise have been passed onto ratepayers, Woolf said.
But utility spokesman Dave Eskelsen, citing experts retained by the state, contends the study was rigged to produce predetermined conclusions.
The rooftop solar debate ignited two years ago when Rocky Mountain Power (RMP) sought to impose a $4.35 monthly surcharge on net-metered customers. The utility has failed to convince regulators that such a fee is warranted, but the PSC is now trying to determine the costs these customers incur for the system and benefits they provide.
This week's hearing fielded dueling testimony from experts hired by the utility, the state and solar backers, and it concluded Thursday after remarks from residents who streamed through the meeting room.
Once the commission settles on a way to value rooftop solar power, RMP hopes to conduct a study to determine the cost of providing electrical service to net-metered customers, then adjust its rates accordingly.
Much is at stake.
"The commission could take a short-term look at the costs and benefits, which would undervalue solar and the long-term benefits that private investments in rooftop solar provide to Utah's electricity system. The latter would have a devastating negative impact on Utah's solar future," Wright said. The Sierra Club and the industry group Alliance for Solar Choice joined Wright's group in presenting formal arguments in support of rooftop solar's value.
Calculating the benefits of distributed solar has been a tricky and contentious exercise in social arithmetic.
Solar proponents insist regulators should consider avoided costs, reduced emissions, innovation and reduced wear on the grid.
The utility believes the benefits that count are the ones that can be counted. Many of the benefits cited by solar backers are speculative or defy measurement, Eskelsen said. Meanwhile, solar customers receive a benefit that is easily measured every time their monthly bills arrive.
"They are getting a generous credit for the energy they produce," he said. "This is not about generating revenue. The object is to correct the subsidy inside the residential class. Net-metered customers are reducing their bills to the point they are not paying for the poles and wires. It's purely a rate-fairness issue."
On that point, the Division of Public Utilities and Office of Consumer Services agree with the utility.
"Costs are being shifted, in many cases, to customers who do not have the opportunity themselves to make distributed resource investments, either because they cannot afford to make the upfront investment or do not have suitable housing arrangements to pursue rooftop solar, wrote Michele Beck, who directs the Office of Consumer Services, in her testimony. "The inequity in access to distributed resources creates an even greater public policy concern in having costs shifted among these customer groups."
But customers with solar panels say their investments help society as a whole by reducing RMP's need to burn coal, which pollutes the air and emits greenhouse gases blamed for climate change.
The utility's critics argue its quest to raise rates on solar customers is part of coordinated effort, led by RMP parent Berkshire Hathaway Energy, to discourage the spread of net-metering in numerous states.
"This fight comes down to competition," said Lauren Randall, a spokeswoman for the residential solar leasing firm Sunrun Inc. "The way they make money as a utility is through capital investment and making sure they own all the power they sell. It's about monopoly control. It is antiquated, and it does not support consumer choice. They want to make sure there is no precedent set in any state."
Hundreds of email comments have inundated the PSC in recent weeks, most imploring the agency to not penalize net-metered customers.
"New knowledge and available technology have now made it possible to improve not only our own circumstances and in the process lessen the negative impact on the environment," wrote Geniel Twitchell. "It is not right and proper that we should pay RMP for something of such long-range benefit as solar power that they do not furnish."