All across the United States, rooftop solar panels are popping up on homes, businesses and schools like mushrooms in a forest, and utility-scale solar projects are bringing huge amounts of clean energy into our communities. Why?
Duane Tilden‘s insight:
>Today, smart policies — likeRenewable Portfolio Standards (RPS) and Net Energy Metering (NEM) — are helping to fuel solar’s explosive growth. Our industry now employs 120,000 Americans at 5,600 U.S. companies. What’s more, we’re now generating enough electricity to power more than 1.5 million homes…
Part of this amazing success story can also be attributed to the fact that the average cost of a solar system has dropped by nearly 40 percent over the past two years and by a whopping 50 percent since 2010. As a result, American consumers, businesses and schools are flocking to rooftop solar. According to the most recent statistics, the residential market alone grew by 48 percent in the second quarter of 2013 compared to the same time period a year ago. […]
NEM has significantly contributed to this growth. Simply put, NEM is a credit on your bill that represents the full value of electricity delivered. Think of it this way: surplus energy generated by a home or business system is exported to the electricity grid, allowing a consumer’s meter to spin backwards. This allows the homeowner or business owner to have greater control over their energy use and prices. […]”<
Net metering makes small-scale renewable energy, such as rooftop solar panels, more affordable by crediting the “distributed generation” owners for the excess energy they produce.
Duane Tilden‘s insight:
>Why the new focus on net metering? The cost for rooftop solar panels has fallen 80% since 2008, including 20% in 2012 alone. Installed rooftop solar energy has increased by 900% between 2000 and 2011. As consumers install more rooftop solar panels and net meter them, utility revenues will decrease.
Net metering policies vary from state-to-state, including the amount of the payback for excess energy. The most favorable policy for distributed generation owners is an excess energy credit equal to the full retail energy rate consumers pay for energy, i.e. the amount consumers are charged for using energy. Most states use this measure. However, utilities claim this prevents them from recovering their full costs and overpays distributed generation owners, unfairly shifting costs to other consumers. Utilities say the credit should be equal to the utilities’ wholesale energy cost at the time of day when excess energy flows back to the grid.
Despite attempts by utilities to change net metering policies, state regulators are keeping these policies intact. Earlier this month, the Idaho Public Utilities Commission rejected Idaho Power’s request to pay less than the full retail rate and to impose higher charges on net metering consumers. Last month, the Louisiana Public Service Commission rejected similar requests by Louisiana utilities. More recently, Arizona Public Service Company raised the issue in a ne[…]<