NewEnergyNews: TODAY’S STUDY: The Fight Over Solar Policy Goes On


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    Tuesday, November 01, 2016

    TODAY’S STUDY: The Fight Over Solar Policy Goes On

    50 States Of Solar; Q3 2016 Quarterly Report

    October 2016 (North Carolina Clean Energy Technology Center)

    Executive Summary

    Overview Of Q3 2016 Policy Changes In The Third Quarter Of 2016, 42 States plus DC took a total of 117 actions related to distributed solar policy and rate design (Figure 1). These actions span at least 95 unique regulatory dockets. Table 1 provides a summary of state actions related to net metering, rate design, and solar ownership during Q3 2016. Of the 117 actions catalogued, the most common were related to residential fixed charge increases (44), followed by net metering (31), and solar valuation or net metering studies (17).

    Top Five Solar Policy Developments Of Q3 2016

    Five of the quarter’s top policy developments are highlighted below. Several major regulatory decisions were made in Q3 2016, as well as continued work in other significant solar proceedings.

    Demand Charge and Net Metering Decisions Delayed in Unisource Energy Services Rate Case

    Until Arizona Value of Distributed Generation Proceeding Concludes In August 2016, the Arizona Corporation Commission (ACC) issued a decision in Unisource Energy Services’ general rate case, which includes proposals to increase the residential fixed charge, adopt a demand charge for customers with on-site distributed generation (DG) systems, and reduce the net metering credit rate. The ACC approved an increase in the residential fixed charge, but delayed a decision on the demand charge and net metering proposals until a decision is made in the state’s broader Value of DG proceeding.

    Nevada Settlement Agreement Grandfathers Existing Net Metering Customers

    The Public Utilities Commission of Nevada (PUCN) approved a settlement agreement in September 2016 grandfathering net metering customers who had applied or installed systems by December 31, 2015. The PUCN’s December 2015 decision to reduce net metering credit rates did not originally grandfather existing net metering customers. The Governor’s New Energy Industry Task Force also recommended that the legislature restore retail rate net metering, with a $25 minimum bill, until the PUCN can implement a compensation mechanism based on the value of solar.

    Arkansas Evaluates Net Metering Credit Rate Issues

    In accordance with legislation enacted in 2015, the Arkansas Public Service Commission is evaluating the state’s net metering policy. A major part of this investigation is focused on examining cost-shift issues and determining if changes should be made to net metering credit rates or if customer-generators should pay additional charges.

    Grid Access Charges Dropped in Favor of Time-of-Use Rates in Xcel Energy Colorado Settlement Agreement

    In August 2016, a settlement agreement was reached in Xcel Energy Colorado’s general rate case, in which the utility proposed a new grid access charge for all residential customers. Instead of adopting a grid access charge, Xcel Energy would implement pilot time-of-use rates for residential customers, with the goal of making these default rates. The settlement has not yet been approved, but is supported by a majority of parties.

    NARUC Releases Draft DER Compensation Manual

    The National Association of Regulatory Utility Commissioners released their draft distributed energy resource (DER) compensation manual in July 2016. The manual does not make recommendations for DER rate design, but rather offers regulators a menu of options and issues to consider. NARUC accepted comments on the draft manual through September 2, 2016.

    The Big Picture: Top Trends Of Q3 2016

    1-A Departure in Fixed Charge Decision Trends ‘

    Requests to increase residential fixed charges are showing no sign of slowdown. In contrast to last quarter’s fixed charge decisions, where most utilities were not granted an increase, all fixed charge decisions in Q3 granted utilities at least a partial increase. On average, utilities were granted 53% (median of 37%) of their requested increase in Q3 2016.

    2-Net Metering Credit Rate Considerations Continue

    The majority of net metering changes relate to credit rates for electricity exported to the grid. There are currently [nine] states considering changes related to credit rates, up from seven last quarter.

    3-Increasing Granularity of Community Solar Credit Rates

    Most community solar programs are structured such that subscribers receive retail rate per-kWh credits on their bills. However, recently some states have proposed more granular approaches to community solar credit rates, with one state proposing time-of-use rates and another moving toward value of solar rates.

    4-More Action on Demand Charges for All Residential Customers

    Residential demand charges remain an emerging area of interest, but few proposals are being put forward by investor-owned utilities. Of note, the two most recent proposals for residential demand charges apply to all residential customers, rather than residential customer-generators only.

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