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New State Study Demonstrates Net Metering Benefit for Ratepayers; What is the impact in your state? January 23, 2013

Posted by Laura Arnold in Net Metering.
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Original article: http://www.renewableenergyworld.com/rea/blog/post/2013/01/new-state-study-demonstrates-benefit-to-ratepayers-of-net-metering??cmpid=WNL-Wednesday-January23-2013

By Andrew Savage, January 21, 2013

The body of evidence that demonstrates the benefits of solar net metering to retail electric customers continues to grow.

From California and Texas to New York and now Vermont, there is a growing stack of reports that make the financial case for greater deployment of distributed solar generation and net metering.

On the same day that a Vote Solar Initiative report was released, which found that in California solar net metering provides over $92 million in annual benefits to ratepayers, a newly published Vermont report echoed the same growing body of evidence that documents the benefits of solar net metering.

A recent report on New York found that solar PV delivers between a 15-cent and 40-cent benefit to ratepayers and taxpayers.  Another report from Texas by the analysts at the The Brattle Group found that the total customer benefits of adding solar capacity in the Lone Star State was valued at more than $520 million.

The Vermont legislature charged the report author, the Vermont Department of Public Service, with determining if there is a cross-subsidization with net metering and other retail customers and to examine any benefits or cost of net metering systems to the distribution and transmission system. The report found that solar net metering is a net-positive for the state — a 4-kW PV fixed system provides a 4.3-cent net societal benefit per kWh generated, and a 4-kW 2-axis PV system provides a net 3.3-cent benefit.  A similar conclusion was made for 100kW net metered PV systems.  The report addresses the specific ratepayer benefit as well as the statewide, societal benefit.

This conclusion comes even with Vermont’s statewide solar incentive program factored in, which provides an average 20-cent per kilowatt hour value of solar, or an average solar incentive across the state of 5.3 cents above residential retail electric rates.

The report outlines the calculable benefits of solar net metering, primarily:

  • Avoided energy costs, including costs of line loses, capacity costs, and avoided internalized greenhouse gas emission costs
  • Avoided regional transmission costs
  • Avoided in-state transmission and distribution costs
  • Solar’s coincidence with times of peak demand and market price suppression

An additional benefit explicitly not covered in the study is the economic multiplier associated with the local investment and job creation created from the local manufacturing and installation of net metering systems.  The report also didn’t cover the statewide benefit of retaining more dollars locally.

Net metering in Vermont has grown by a factor of four since 2008, with solar accounting for 88 percent of all net metering systems.  According to the report, most of these systems, or 59 percent, are less than 5kW, and 85 percent are under 10kW.  (Vermont recently passed a efficient, first-in-the-nation solar registration program for permitting solar systems 10kW and below.)  Even with the growth of net metering in the state, net metering systems still produce less than 1 percent of the 35 GWh of power Vermont uses each year.

Andrew Savage is on the management team of AllEarth Renewables, the Vermont manufacturer of the dual-axis AllSun Tracker.

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