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

Perhaps we need to look to other cities/countries that are implementing renewable energy and selling the excess to surrounding cities. Wildpoldsried Germany has taken over their own grid and now generates enough excess power to create $5.7 million in revenues for their city annually - obviously Rocky Mountain Power does not have the best interest of Utah in mind perhaps a change is in order!

I spend 4 months a year in Utah -- I love Utah's outdoors.

The rest of the year I live and work in Silicon Valley. One day a week I commute to the office, well I actually car pool to work with my girlfriend who works at Google. On the way to work the HOV lanes are filling up with electric cars. We usually see a google self-driving car too. Once we get to Google the entire front row of parking places is full of electric cars being charged while people work.

When working from home I walk to the post office. I see many houses with solar panels. Solar City will install them for free and rent them to you for less than your electric bill.

Welcome to the future. It's here today and Utah needs to catch up with Silicon Valley. Let's encourage renewables anyway we can. If we're smart we could also use renewables and electric cars to also solve the winter inversion problem.

Yesterday I ordered a 4.3 Kwatt solar array for my house in Sandy, which should more than offset my annual usage. I encourage you to do the same.

rocky mountain powers request to increase solar net customers does not make sense to me.
the biggest worry for rocky mountain is maintaining and updating their infrastructure for INCREASED demand.
solar net users decrease the need for this cost.
it seems to me that rocky mountain power should not only reimburse solar net customers market rate,, but also pay an incentive fee to net solar users for providing clean energy for power customers to use.
upside down: lets put is right side up

they already charge net metering residential customers an additional $4 to $8 charge each month now. look at your rocky mountain power bill (sorry I can't use proper capitalization - they kick out my comment for shouting) there will be a bunch of junk charges based on your kwh useage. If you go to net metering, since your usage will go down, those charges are now replaced by a non-varying fee called a net metering fee. think that is an average of what it used to be or closer to the maximum? guess. utah and rmp does not want solar. bigbusiness is running this country, don't make any mistake. Check your electric bill just before the state decided to convert to rmp, then see how much it has increased.

I have noticed that solar is the focus of both the article and the comments. I have been researching the installation of wind generation on the roof of my home here in Oregon and it seems to be about half the money of solar. Being somewhat familiar with Utah, I can honestly say I am surprised no one has mentioned all the power being generated along the slopes of the Wasatch Front. I know the wind blows there just about everyday. I have seen designs for wind power in vertical and horizontal positions for rooftop and mast mounted installation. I wonder!

Some of the comments here decry the assertion that consumer generated power is a "good" investment. It would seem that the only fair determinate of that appellation--good--is the one making the investment.

As a society we have become very aware of the accounting term Return On Investment(ROI) as a way to judge what we might want to do with our money which is excess to our standard of living. I believe that might be a valid number to know but a pretty poor determinant if used alone. Frankly, it smacks of greed.

As I understand it RMP is trying to change from buying consumer-generated power at a "retail" rate to a "wholesale" rate. That is an argument supported only by assertion that power is disconnected in time and or place. The real picture is that RMP supplies power and the consumer pays for power on a monthly basis. Consumers who generate some of their own power sometimes generate more than they need and so the net use of power over the month is less; thus lower net billing to that customer. They are viewing that circumstance as paying retail for the lost sales. That is a thinking error and I was disappointed that the government agency seemed to be open to thinking that way.

They aren't alone; most accountants have been trained to use a "potential" as an opportunity cost in planning of any revenue maximization efforts.

@JoeCapitalist2--You are making assumptions I believe are not accurate. Based on the size of his system, I imagine he is saving about $150/month on average over the entire year, not just the summer peak months. Quite possibly it is even more.

Additionally, on top of a 30% fed tax CREDIT, there is a 20% state tax credit (up to $2000). So his out of pocket is closer to 18K (unless he did this system before there was a state tax credit).

Lastly, there are other reasons besides financial that we do these things.

PEOPLE--please do not be misinformed. As a net metered customer, if I were to produce more power than I consume for a given year, RMP DOES NOT pay me for that extra electricity. Month to month, yes, it is carried forward and used against future months usage--ONLY UP TO THE POINT OF USAGE...NO MORE! At the end of the year, the slate is "wiped clean." In other words, if I had a surplus of 500kWh that I had produced over what I consumed, RMP resets the counter to 0 and starts the new year...they GET those 500kWh.

PLEASE BE AWARE OF THIS GARBAGE RATE INCREASE AND UNDERSTAND IT FOR WHAT IT IS. Others above have already commented on many of the other benefits RMP receives from net metering customers.

One more thing, we do already pay an interconnection fee ON TOP OF any electricity overage produced. It is 5 or 6 bucks a month. My understanding is that this interconnection fee is supposed to cover the infrastructure costs claimed by RMP to be so much disturbed by us net metering customers...sarcasm included.

Isn't this like charging ward members a fee for bringing food to ward party pot luck?
[...um, it's to help off set the costs for wear and tear on chairs and tables...]

Wrong on so many levels...

As the person mentioned in the article, I'd like to clarify a few things and explain why the pie chart graphics give the wrong impression and why the $4.25 charge cannot be justified.

RMP claims that my overproduction has a dramatic impact on their infrastructure. Here's the truth:

- The only impact my overproduction has is on the 75’ from my meter to the common junction with my neighbor. From there it goes directly into my neighbor’s box and doesn’t get anywhere close to a high-voltage line, power generation facility, etc.
- When RMP ‘buys’ my power they do so at a lower rate; when the resell that power to my neighbor they do so at a higher tier rate.
- When a kWh of my efficiently overproduced power goes to my neighbor it eliminates the need for RMP to inefficiently produce multiple kWh’s at a distant power plant.
- Every kWh I generate, overproduced or not, has far less carbon impact than the coal or gas burning power plants used by RMP.

Space here is limited so see my comments at the PSC here goo.gl/MSzE5A and the RMP filing here goo.gl/Z66cGs.

Mike Rossetti

micawber: So how much do you save on electricity each year due to your solar panels? How much did it cost you to install and maintain each year? How long will it take to "break even" on your investment without taking into account any tax subsidy you might have received? 20 years? 30?

If so, you might feel good about your contribution to "clean energy", but don't try to claim that it is a good investment.

@Joe Capitalist. Solar panels generate electricity all year long, not just when air conditioning is being used. My solar system generated more than 25 kWh today. I did not use my air conditioning today.

A $5.00 dollar fee is going to offseet this huge burden? This proposal will generate $132,000.00. That's not even a drop in the bucket. Not to mention the fact that these customers actually provide free generating capacity during peak hours.

In all, Rossetti estimates he spent $28,000 on the project, but he received a 30 percent tax break as an incentive...We wanted to reduce our (electricity) bills,” Rossetti explained...His monthly cost for air conditioning in the warm weather months has gone from the $250 to $300 range to about $120. Thus far, it has been a worthwhile investment, Rossetti said."

He needs to learn a thing or two about "investing". Assuming the maximum savings ($180) for the 4 months each year we need air conditioning, that equates to about $720 a year. Even if you expanded it to $1000 savings per year, it would take 28 years to break even (assuming money spent today has the same value as money spent 27 years from now).

I will invest in solar power when my ROI is 5 years or less (without defraying the cost onto some other taxpayer through a subsidy). Let me know when that is feasible.

I have not made my opinion as of yet on the topic. However, I did notice a logical inconsistency of Sara Baldwin Auck, Utah Clean Energy senior policy and regulatory associate. She said, "It should not be the policy of Utah to interfere in the market and stifle competition. Instead, Utah should continue to encourage personal investments in energy efficiency and renewable energy."

At the beginning of the article, the author wrote, "Rocky Mountain Power claims that under current state regulations, the company is required to credit customers for excess generation at the full retail rate..."

Auck said she doesn't want Utah policy to intefere with the market. However, Utah policy is already intefering with the market by forcing the power company to crediting net-metering people more than they would like. Really, Auck is saying, she currently likes the way the government has interfered because it helps her cause. I don't disagree with Auck that people, such as herself, should be reimbursed for the energy they provide. I do disagree with how she states her opinion, because it makes it sound like she is promoting less government (something most Utah residents like) when she is not.

RMP and their friends and supporters in this debate need to step back and look at the bigger picture. I'll attempt to show them.
We all use electricity and nat gas.
We all want to reduce pollution from combustion related methods of making electricity.
We all want to promote sustainable and enviromentally friendly ways of making electricity.
There are other ideals we all want as far as power for our industries and homes.
So RMP should support those (few) of us who buy a solar panel array for our home's roof. Looking at the big picture, RMP should get on the solar band wagon and cover any and all of their buildings' roofs with solar panels, they should join in a cooperative way any and all groups that operate rooftop systems. And RMP should spread the cost of designing, developing new voltage controls to accomodate the variability of solar (and wind) power, spread that cost over all users, or better yet over the stockholders.

RMP does need money to operate their system; RMP deserves a return on their investment; RMP does not have a good reason to hit the wallets of the rooftop solar innovators.

re Fitz
Murray, UT

Somehow, those that think it is fair for individuals to get retail rates for excess power generated from solar and wind power at their residences need to look at the whole picture. They currently are myopic.

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While all the points you make are correct, you need to look at the whole picture. These people are contributing to cleaner air for all of us. These people are paying early (higher) prices for solar technology. If this industry is to grow, the early adopters will be needed. They are paving the way for the rest of us.

Natural resources are finite and I appreciate cleaner air. I am willing to pay slightly higher rates to pay to encourage early adopters of solar technology.

I don't know how smart it is to spend $28,000 to save $130-$180 per month. The payoff, discounting considerable ongoing maintenance, is 155 to 215 summer months, or 26-36 years, assuming 6 months of a/c use. Those are very rough figures but that's still not a very financially savvy strategy.
The reason solar energy has not been more widely used is simple economics- it's still way too expensive even when it's generated on economies of scale and has to be subsidized by unwilling taxpayers. The future may bring improvements in solar generation but the future is not here now. Personally, I'm waiting until we can capture lightening in a bottle- with the recent announcement of advanced chemical storage batteries, that is likely closer than widespread economical solar.

Should I pay more at the store for lettuce if I also have a home garden, too? These large corporations are silly for trying to convince the general population that somehow an "invisible subsidy" is being affected for when they generate their own electricity. And then translate this "invisible subsidy" into a dollar amount that qualifies as a rate increase? If customers sold the electricity they generate, then I could see a conflict. But generating and using their own energy? Utah is doing the right thing by investigating these dubious claims, and correctly rewarding consumers who are smarter than the system and -- more importantly -- financially able to put in a $28,000 solar panel system. Give the guy credit. He made a smart investment! Hopefully more people can do likewise!

The "subsidized" argument is nonsense. It's just a divide-and-conquer tactic. Make the average customer jealous at those who have invested in solar installations, so they can get their rate increase. In fact, having power distributed on the retail-customer grid means that the utility doesn't need to spend additional money on infrastructure to bring power to the grid from elsewhere. That money would make them more money.

Utilities generally get granted rates on an investment "cost plus" basis. In these days of low interest rates, they'd love to be able to invest lots more in plant and lines so they can make whatever the public utility commission will allow them to on their investment, typically 6% or more annually. Also, those last few kilowatt-hours that they would otherwise have to buy on the emergency/peak market are super-expensive, and an additional source of revenue/markup. And those residential solar generators are spoiling their corporate financials.

Power companies should only have to pay net-metering companies the same wholesale rate that they pay to any other provider.

But, then again, I would be happy to see the dinosaur utility companies go extinct by having each consumer source their own utilities wherever possible and to the extent possible.

The proposed rate change is based on absolutely absurd reasoning.

The net-metering tariff only keeps track of how much power was pushed into the grid. The home-owner uses most of it immediately. If they make a little extra, the meter runs backward. If not, it runs forward. It is NET metering.

RMP benefits because the excess power made comes at a time when need is greatest (peak solar power output coincides almost perfectly with peak air-conditioning demand). Solar actually smooths RMP's demand spikes. If you follow RMP's reasoning, THEY should actually PAY people spending $28,000 (for the totally FREE solar infrastructure they provide the grid).

Letting them use the power they generate seems pretty reasonable.

Plus solar is clean. Every solar system helps get rid of the inversion. Plus solar distributes power production, making it harder to take down. Those with solar on the roof should be hailed as heros. We need more solar, not less.

Net metering folks should not be subsidized
by the ratepayers who in many cases are on
fixed income. The utility laws need to be updated
to reflect costs.

Somehow, those that think it is fair for individuals to get retail rates for excess power generated from solar and wind power at their residences need to look at the whole picture. They currently are myopic.

For homeowners to sell power back to the power company, they need to sell it on the power grid. Yet the homeowners do not pay for designing, maintaining, building, or operating the grid. Yet they want full retail payments for power they generate? That is both naive and unfair. If they go off the grid and generate 100% of their own power, great, go for it. If they are using the local power companies power lines, then they should pay a fee for the use of the local power companies lines. That is only fair.

But then those that want to sell excess power, but not pay for the use of the lines, they could always go through the same process that every power generation company does, they can design, get approval from the State, buy the right-of-way, build, maintain, and operate their own grid.

What they need to do is follow the path that Questar Gas did and "de-couple" the infrastructure cost from variable cost of natural gas. I use very little natural gas in my home, but still pay a $5 per month connection fee. RMP should do something similar to this.

What RMP is NOT publicizing is how having so much distributed solar throughout its service territory actually bolsters their overall system, especially during peak load times when the sun is shining and everyone has their air conditioning on. RMP typically has to buy power at the highest rates during these peak times, but private solar panels curb their need to make those purchases because that is when the panels are producing the most power.

As a public service monopoly, RMP needs to be working on behalf of its ratepayers -- not just their shareholders.

At a time when we have excessive air pollution and tightening water resources, solar producers are contributing to better air quality and reduced water use (less reliance on coal-fired steam plants), and those solar owners should be recognized/compensated for their reductions in overall pollution and water use in the state.

" approximately 2,200 customers like Rossetti who are residential energy producers are being subsidized unfairly by customers who do not produce power."

Yes, that is exactly what every government solar program has done, and every solar provider has reaped big benefits. They have taken from everyone to make money on solar.

So why is Solyndra good when they do it and a home owner evil when he does it? Sounds like crony capitalism to me.

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

No.

All across the country power companies are trying to slow the adoption of solar power by home owners. They use a number of "good" reasons for this but the real reason is that the use of solar panels by home owners is a disruptive technology for their monopoly.

The fairness issue is interesting because there is a real debate about whether net metering for home owners costs the utility or pays them. There are reduced infrastructure costs for the utility when solar panels are in use. Solar panels have a close match to the highest need for power by the utility. Both are at their highest on hot summer days. The thing is no one knows what to count and not count. Until there is agreement on that, no one can know whether the current rates are fair or not.

Something that is known is that taxpayers have spent billions on getting us to the point that solar power is cost effective for the individual home owner. As soon as this happens the power companies do all they can to make sure it is not. Now is that fair?

I don't produce power. I don't think it unfair to encourage people who do. Early adopters will pave the way for the rest of us to do this eventually as prices for this technology decreases.

Oh, the humanity! Rocky Mountain Power, now concerned with "treating customers fairly," while they lobby for yet another rate increase.

simplified, the argument they are making is if enough people switch, then the variable income would drop to a point that it wouldn't cover the fixed costs.