Thursday, March 02, 2017
Search Articles...
HOME »VALUE OF UTILITY SCALE VS. ROOFTOP SOLAR DEBATED AMID PRICE DECLINE
« UTILITY INDUSTRY LOOKS FOR FEDERAL
POLICY AGENDA THAT FACILITATES
INFRASTRUCTURE INVESTMENTS
NEI CONDUCTS WALL STREET FINANCIAL
ANALYST BRIEFING »
Value of utility scale vs. rooftop solar debated amid price decline
Published on February 14, 2017 by Kevin Randolph
Tweet
Share
Share
Share
Over the last decade, the price of solar
installations has declined significantly,
but the electric utilities industry continues
to debate the value and cost effectiveness
of utility scale versus rooftop solar.
During a panel discussion at the 2017
National Association of Regulatory
Utility Commissioners winter committee
meeting on Monday, two experts
highlighted the different benefits and
challenges associated with utility and
rooftop solar. The need to accurately
determine solar prices, the role of
subsidies, net metering regulations and
the effects of technological advances all
factor in to determining the value of
solar.
“I’m pro utility scale over rooftop,” said Brian Potts, an attorney and litigator focusing on environment and natural resources and
energy law, as well as a partner at Perkins Coie. “I don’t mean that people shouldn’t be allowed to put on rooftop solar. It’s a
question of what is good for society and should we be subsidizing something that is essentially the same technology that costs two
to three times as much.”
John Farrell, director of Democratic Energy at the Institute for Local Self­Reliance, identified several benefits specific to
distributed solar. Those advantages include peak shaving, resiliency, as well as voltage and frequency support. Solar also creates
reduced variability by distributing power where it is developed, Farrell said. Solar has load reduction benefits and also is able to
put energy back onto the system.
Potts countered that view, arguing that utility scale solar is cheaper and offers many of the same benefits, while also having fewer
operational issues.
“Rooftop solar and distributed generation (DG) has a lot of societal benefit, but there’s not a lot of societal benefit that isn’t also
provided by utility scale solar,” Potts said.
DG and utility scale solar are difficult to accurately compare. “Because it doesn’t compete on the same level … that our large­
scale solar does, we’ve had to come up with new ways to value it and figure out how to calculate it,” Farrell said. “That levelized
cost of energy comparison we’ve been using is insufficient in order to determine what is the appropriate price of the resource.”
Both Farrell and Potts agreed that net metering is not necessarily the best way to determine the worth of solar energy. Farrell cited
Minnesota’s value of solar policy, adopted in 2014, as a good start for determining the price of solar. The idea behind the value of
solar is that utilities should pay a transparent and market­based price for solar energy.
The role of net metering, subsidies and regulations were also debated during the panel. Rules vary by state, which makes
determining value even more difficult and influences how economical various kinds of solar projects are.
Potts said that tax benefits and net metering tend to benefit smaller projects.
“I like all solar, but I don’t necessarily think we should be subsidizing all solar,” Potts said. Farrell, however, argued that net metering is not a subsidy.
“It’s simply the price that we pay for electricity to be delivered to a certain point,” he said. Farrell also emphasized that the industry needs to figure out how to price solar in order to best invest public resources. He also
stressed tension surrounding solar energy business models, which are still evolving along with the industry and, according to
Farrell, have not been addressed sufficiently.
Overall, the panelists agreed that both rooftop solar and utility scale solar have benefits but differed on the role regulations,
subsidies and net metering should play, as well as the level to which each is valuable to society.
“The challenge is that given that we have limited resources, we may have to choose sometimes,” Farrell said. “I think we’re at a
point in the design of our electricity system in terms of the transition from fossil fuels to renewables where we may not have to
make that decision as much as we may in the future.”
« UTILITY INDUSTRY LOOKS FOR FEDERAL
POLICY AGENDA THAT FACILITATES
INFRASTRUCTURE INVESTMENTS
CONNECT WITH US
SIGN UP FOR WEEKLY NEWSLETTER
NEI CONDUCTS WALL STREET FINANCIAL
ANALYST BRIEFING »
Subscribe!
Email Address
MOST READ LAST 7 DAYS
1. Duke Energy announces record­breaking amount of nuclear generation in 2016
2. Vectren announces grid modernization plan, universal solar projects
3. Industry consortium proposes strategies for small nuclear reactor deployment
4. Congressional delegation sends letter on PNNL National Lab to Trump
5. Spotlight shines on need for consumer protections in solar industry
6. Madison Gas & Electric proposes largest wind farm
7. Georgia commission approves expenses in Fifteenth Plant Vogtle Construction Monitoring Report
8. GE creates Renewable Energy Services Business
9. New Mexico Public Regulation Commission approves demand response program
10. More than three million Americans now work in clean energy, according to DOE report
LATEST POLICY NEWS
Canada largest US energy trading partner, according to EIA
Lawmakers urge Trump to act to fill FERC vacancy
Advocates stress need for greater progress on advanced nuclear development
Congressional delegation sends letter on PNNL National Lab to Trump
Industry consortium proposes strategies for small nuclear reactor deployment
NEWS ARCHIVE
2017
2016
DailyEnergyInsider | Your Resource for Energy Policy and News
Copyright © 2017. All rights reserved. | Sitemap