Shenot J Community Solar Presentation
Community Solar: Connecting with Customers and Working through the Public Policy Challenges 2015 Utility Solar Conference San Diego, California
Presented by John Shenot April 29, 2015
The Regulatory Assistance Project
50 State Street, Suite 3 Montpelier, VT 05602
Phone: 802-223-8199 www.raponline.org
Customers Want Solar Do you think that as a country, the United States should put more emphasis, less emphasis or about the same emphasis as it does now on producing domestic energy from each of the following sources?
% More Emphasis
% Same Emphasis
% Less Emphasis
Solar
79
12
9
Wind
70
14
14
Natural Gas
55
32
12
Oil
41
27
30
Nuclear Power
35
28
33
Coal
28
27
43
Source: Gallup Poll; March 2015
2
They Want Solar on Their Homes and Businesses
Source: SolarCity and Clean Edge; March 2015 Poll of U.S. Homeowners
3
All Sorts of Customers!
4
Rooftop PV is Increasingly Affordable
5
But… Deployment of Rooftop PV is Constrained by Other Factors × I’m a renter × I expect to move to a new home soon × I can’t get financing × My rooftop isn’t suitable
6
My Rooftop Isn’t Suitable!
Only 22-27% of Residential Roof Area is Suitable for PV
Source: NREL 2008.
7
Community Solar Addresses the Biggest Non-Cost Constraints Credits can attach to your bill, even if you rent, and move with you to a new location (in the same utility’s service territory) Some programs provide access to nomoney-down, low-interest, no-fee financing Community projects are sited in suitable/optimal locations 8
Public Policy Challenges
9
Key Challenges for Community Solar • Laws, regulations or utility commission decisions limit who can offer it • Net metering/solar tariff design: – Can make community solar contrary to utility’s or customer’s self-interest – Can lead to undue cross-subsidies
• Retail rate design: – Can undermine cost-effectiveness/add risk 10
Where are the programs?
3rd Party Solar PV Power Purchase Agreement (PPA) www.dsireusa.org / March 2015
RI: May be limited
IA: See notes
to certain sectors
NV: With system size limitations
CO: With system UT: Limited to size limitations certain sectors
DC VA: Limited within a certain utility's service territory
AZ: Limited to certain sectors TX: With system size limitations
At Least 24 States U.S. Territories PR
Guam
USVI
NMI
Apparently disallowed by state or otherwise restricted by legal barriers Authorized by state or otherwise currently in use, at least in certain jurisdictions Status unclear or unknown
+ Washington DC and Puerto Rico Authorize or Allow 3rd Party Solar PV Power
Customer Credits for Monthly Net Excess Generation (NEG) Under Net Metering www.dsireusa.org / March 2015
DC
NEG at retail rate (or above); credits do not expire
NEG at less than retail rate (e.g., avoided cost rate)
NEG at retail rate at first, then credits expire or are reduced (e.g., to the avoided cost rate) after set period of time
NEG at $0
No uniform or statewide mandatory net metering rules
14
Keys to Long-Term Success • Authorization: explicitly allow community solar programs (utility, 3rd party, or both) • 3rd Party Siting: involve the utility • Solar Tariffs: customers should receive fair and just compensation for the power they supply – no more and no less • Subsidies: if any, should be provided outside of the utility bill (e.g., tax credit) 15
More Keys to Long-Term Success • Rate design: – Customers should be able to connect to the grid for no more than the cost of connecting to the grid – Customers should pay for grid services and power supply in proportion to how much they use, and when they use it
• Consider utility incentives and decoupling utility revenues from sales 16
Thank You for Your Time and Attention About RAP The Regulatory Assistance Project (RAP) is a global, non-profit team of experts focused on the long-term economic and environmental sustainability of the power and natural gas sectors. RAP has deep expertise in regulatory and market policies to: Promote economic efficiency Protect the environment Ensure system reliability Allocate system benefits fairly among all consumers Learn more about RAP at www.raponline.org
John Shenot: [email protected]
Presented by John Shenot April 29, 2015
The Regulatory Assistance Project
50 State Street, Suite 3 Montpelier, VT 05602
Phone: 802-223-8199 www.raponline.org
Customers Want Solar Do you think that as a country, the United States should put more emphasis, less emphasis or about the same emphasis as it does now on producing domestic energy from each of the following sources?
% More Emphasis
% Same Emphasis
% Less Emphasis
Solar
79
12
9
Wind
70
14
14
Natural Gas
55
32
12
Oil
41
27
30
Nuclear Power
35
28
33
Coal
28
27
43
Source: Gallup Poll; March 2015
2
They Want Solar on Their Homes and Businesses
Source: SolarCity and Clean Edge; March 2015 Poll of U.S. Homeowners
3
All Sorts of Customers!
4
Rooftop PV is Increasingly Affordable
5
But… Deployment of Rooftop PV is Constrained by Other Factors × I’m a renter × I expect to move to a new home soon × I can’t get financing × My rooftop isn’t suitable
6
My Rooftop Isn’t Suitable!
Only 22-27% of Residential Roof Area is Suitable for PV
Source: NREL 2008.
7
Community Solar Addresses the Biggest Non-Cost Constraints Credits can attach to your bill, even if you rent, and move with you to a new location (in the same utility’s service territory) Some programs provide access to nomoney-down, low-interest, no-fee financing Community projects are sited in suitable/optimal locations 8
Public Policy Challenges
9
Key Challenges for Community Solar • Laws, regulations or utility commission decisions limit who can offer it • Net metering/solar tariff design: – Can make community solar contrary to utility’s or customer’s self-interest – Can lead to undue cross-subsidies
• Retail rate design: – Can undermine cost-effectiveness/add risk 10
Where are the programs?
3rd Party Solar PV Power Purchase Agreement (PPA) www.dsireusa.org / March 2015
RI: May be limited
IA: See notes
to certain sectors
NV: With system size limitations
CO: With system UT: Limited to size limitations certain sectors
DC VA: Limited within a certain utility's service territory
AZ: Limited to certain sectors TX: With system size limitations
At Least 24 States U.S. Territories PR
Guam
USVI
NMI
Apparently disallowed by state or otherwise restricted by legal barriers Authorized by state or otherwise currently in use, at least in certain jurisdictions Status unclear or unknown
+ Washington DC and Puerto Rico Authorize or Allow 3rd Party Solar PV Power
Customer Credits for Monthly Net Excess Generation (NEG) Under Net Metering www.dsireusa.org / March 2015
DC
NEG at retail rate (or above); credits do not expire
NEG at less than retail rate (e.g., avoided cost rate)
NEG at retail rate at first, then credits expire or are reduced (e.g., to the avoided cost rate) after set period of time
NEG at $0
No uniform or statewide mandatory net metering rules
14
Keys to Long-Term Success • Authorization: explicitly allow community solar programs (utility, 3rd party, or both) • 3rd Party Siting: involve the utility • Solar Tariffs: customers should receive fair and just compensation for the power they supply – no more and no less • Subsidies: if any, should be provided outside of the utility bill (e.g., tax credit) 15
More Keys to Long-Term Success • Rate design: – Customers should be able to connect to the grid for no more than the cost of connecting to the grid – Customers should pay for grid services and power supply in proportion to how much they use, and when they use it
• Consider utility incentives and decoupling utility revenues from sales 16
Thank You for Your Time and Attention About RAP The Regulatory Assistance Project (RAP) is a global, non-profit team of experts focused on the long-term economic and environmental sustainability of the power and natural gas sectors. RAP has deep expertise in regulatory and market policies to: Promote economic efficiency Protect the environment Ensure system reliability Allocate system benefits fairly among all consumers Learn more about RAP at www.raponline.org
John Shenot: [email protected]
