Net-metering or distributed solar has been a thorn in the side of utilities as solar became cheaper. As such, they’ve fought back against net-metering policies claiming it creates a cost-shift for customers that don’t have solar power. A new study commissioned by the Public Utilities Commission of Nevada found that distributed solar is having very little impact on electric prices in the state and may actually help reduce electric rate increases in the future.
Energy + Environmental Economics (E3) conducted the study on behalf of the commission to determine the impact of net metering on the state’s ratepayers. The study determined that at the end of 2013 Nevada had more then 3,300 net-metered solar panel arrays totaling over 60 MWs of with 50 MWs coming from distributed PV. “Forecasts of new installations from 2014 to 2016 provided by NV Energy anticipate significant growth (234 MW) in new NEM capacity through 2016,” the study found.
Nevada’s solar incentives changed in 2014. “Prior to 2014, the RenewableGenerations incentive levels were relatively high, and renewable self-generation was cost-effective for the average Nevada [net-metered array],” the study found. It also found that there was a cost-shift to non net-metered solar customers during that time because of higher incentive levels and a solar charge on customers.
“In 2014, with the reduction in utility incentives, self-generation looks moderately more expensive than conventional utility service for the average Nevadan unless installed renewable generation costs drop faster than we forecast.”
This year and next year will actually benefit those who don’t have solar for two reasons, according to the study. It found that low incentives from titles and the high value on distributed solar generation the state has through its renewable portfolio standard will benefit those consumers without solar.
The study said that three things, lowered state incentives, new performance requirement incentives for wind and removal of the public purpose charge credit for exports are making self-generation moderately more expansive than conventional generation. Overall by the end of 2016 new net-metered customers are anticipated to pay a 2 cent per kilowatt hour premium for the power from their solar arrays.
“Overall, we do not estimate a substantial cost shift to non-participants due to NEM going forward given the current and proposed reforms to the program,” the study stated. “We estimate a total NPV benefit of 2004-2016 NEM systems to non-participating ratepayers of $36 million during the systems’ lifetimes.”
In fact, in the future, the study anticipates that distributed generation will save ratepayers more. “When incentives are lower, the total bills NV Energy collects will decrease substantially due to the self-generation. In total, we estimate that bills will decrease by NPV $716 million for all systems installed through 2016 over their 25-year life.”Tweet