Are rate changes needed for customers who generate their own power?

Published: Saturday, Jan. 18 2014 3:00 p.m. MST

Today, more customers are generating a portion of their own electricity, primarily by installing solar panels, he said. In Utah, there are more than 2,200 net-metering customers, with 14.6 megawatts of generating capacity, Murphy said.

“That’s why we are trying to address the issue now while (net metering) is still in its infancy (so) we don’t continue adding costs, especially for our lower-income customers,” he said. “We’re hoping others will weigh in and help us make sure that we are making the right decision about this.”

The utility reported that a typical $80 residential monthly bill consists of about $25 for neighborhood infrastructure and customer service, $25 for power generation, $19 for fuel and purchased power, with $11 going toward high-voltage lines.

Each residential customer receives about $60 in monthly benefit from the utility, Murphy said, but due to Public Service Commission regulations pay just a few dollars per month for the service, while paying much higher rates for power.

The opposite should be true, he said. It’s a subject Rocky Mountain Power wants the commission to review and hopefully revise sooner rather than later, Murphy added.

Other alternative power advocates adamantly oppose any potential changes to Utah’s net-metering policy.

Utah Clean Energy, a Salt Lake City-based nonprofit organization, said such changes would have far-reaching impacts on all sectors — including governments, military facilities, schools, churches and businesses — that want to or have already made the investment in on-site renewable energy generation.

“It should not be the policy of Utah to interfere in the market and stifle competition,” said Sara Baldwin Auck, Utah Clean Energy senior policy and regulatory associate. “Instead, Utah should continue to encourage personal investments in energy efficiency and renewable energy.”

Net metering provides local governments, businesses and residents a vehicle for personal choice, Auck added. A policy change would set a bad precedent for allowing Utah’s monopoly utility to impose ever-increasing costs on customers without any burden of proof, she said.

The head of the state consumer watchdog agency said Rocky Mountain Power’s proposal is not as “draconian” as some might fear.

However, Michele Beck, director of the Utah Office of Consumer Services, said her agency will investigate to determine if the specific fees proposed by the utility are “the right numbers.”

“We’re responsible to advocate on behalf of the residential class as a whole,” Beck said. “We need to make sure that those with solar panels are being treated fairly and those without solar panels are treated fairly.”

The current evidence strongly suggests that residential customers who do not generate their own power “are clearly subsidizing those who do,” she said.

Achieving an affordable pricing structure would eventually encourage more people to install solar panels or other alternative energy sources, Beck said. But for the time being, the majority of residential users are supporting net-metering customers.

Because customer-generated power still requires the full electric system provided by the utility, those consumers are getting an advantage over other customers, she noted.

“Solar is not offsetting the peak (usage hours),” Beck said. “(Net-metering) folks are still using the grid and the vast majority of the electric infrastructure.”

The utility’s desire to have the rate system revamped has merit, she said, though it will take some time to figure out the most equitable solution for all residential consumers.

Meanwhile, Rossetti called Rocky Mountain Power’s claim that customer electric generation does not include the capital investment of infrastructure, voltage lines or the utility's overall power generation “at a minimum disingenuous and manipulative.”

“Prior to installing my solar PV system, I was already paying for their capital investment and power generation,” he said. “After my installation, I am still paying. Further, I am now also paying for my own capital investment and power generation, (along with) my own maintenance and monitoring.”

Having installed a solar PV system has not placed any additional burden on Rocky Mountain Power, Rossetti said.

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