Rooftop Solar

Rooftop Solar

November 20, 2014 | By Keith Martin in Washington, DC

Rooftop solar draws more utilities.

The Arizona Corporation Commission is expected to decide by year end whether to allow Arizona Public Service, the state’s largest utility, to lease space on approximately 3,000 customer roofs to install 20 megawatts of solar systems that the utility would own and put in rate base.

The utility would give the customers credits of $30 a month to use against their utility bills. Each lease would run 20 years. The credit amount would not be adjusted for inflation.

The Arizona Corporation Commission staff recommended in early November that the commission reject the proposal.

Rooftop solar companies argue that such proposals are an effort to prevent competition for retail electricity supply in utility service territories and the utlities have an unfair advantage. Utilities already have a leg up in any competition through existing customer relationships and infrastructure. The ability to put systems into rate base would guarantee utilities the ability to recover their costs plus a return through the rates charged all utility customers. Utilities argue that customers would prefer to deal with a company that they know has staying power rather than with newer solar companies that they worry may not be around for the full term of a contract.

Meanwhile, Tucson Electric Power proposed separately that it be allowed to put solar systems on customer roofs and then charge the customers a fixed monthly charge for 25 years for use of the systems.

In South Carolina, Governor Nikki Haley (R) signed a bill over the summer that would let utilities lease solar systems to customers, but they cannot put the systems into rate base. They would have to own the systems through non-regulated affiliates.

Solar companies are watching to see whether a bill the Washington state legislature rejected this year will be reintroduced in 2015. The bill would have given any utility that wants to enter the solar leasing business a monopoly over the leasing of solar systems in its service territory.

In Utah, the Public Service Commission rejected a request by Rocky Mountain Power in late August to charge customers who feed excess electricity from rooftop solar systems into the grid through net metering a backup charge of $4.65 a month. The commission said the utility failed to prove that the charge was “just and reasonable,” but said it was open to revisiting the issue in the future if the utility could produce more data. In the meantime, it approved a 1.9% rate increase on all customers. There are about 2,700 customers in the utility’s service territory who use net metering.

contributed by Keith Martin in Washington