As Oregon PUC investigates “Value of Solar,” report shows solar’s benefits

Environment Oregon

Households and businesses with solar panels deliver greater benefits than they receive through programs like net metering, a report said today, countering increasing complaints from utilities that solar homeowners don’t pay their fair share.

“While some utilities claim they’re subsidizing solar panel owners, our report shows the opposite is probably true,” said Rikki Seguin, state director of Environment Oregon. “If anything, utilities should be paying people more to go solar, not less.”

The Environment Oregon Research & Policy Center report, Shining Rewards: The Value of Rooftop Solar Power for Consumers and Society, comes as the Oregon Public Utility Commission (PUC) investigates the resource value of solar, as directed by the Oregon State Legislature. This PUC investigation, UM 1716, will help set the stage for future discussions surrounding solar power in Oregon.

“We all are aware that solar has economic, environmental and utility benefits – not only for the homeowners and business that have solar panels – but for all Oregonians.  The Oregon Public Utility Commission, with the involvement of key stakeholders, is moving through a process to determine that value,” said Paul Israel, president of the Oregon Solar Energy Industries Association (OSEIA).

“This study is very timely as we experience more and more heat waves and higher use of air conditioning across the state,” continued Israel. “Recently, utilities are seeing summer as the peak of Oregonians’ electricity usage. Solar produces the most in the summer.”

Net metering programs credit solar panel owners at a fixed rate — often the retail price of electricity — for providing excess power to the grid, similar to rollover minutes on a cell phone plan. The arrangements have helped solar energy skyrocket across the country, but in recent years utilities have increasingly attacked them as unjustified “subsidies.”

Today’s report tells a different story. Of the 11 net metering studies reviewed, eight found that the value of solar energy was higher than the average local residential retail electricity rate. Meaning simply, utilities were likely underpaying solar panel owners, not subsidizing them. The median value of solar power across all 11 studies was nearly 17 cents per unit, compared to the nation’s average retail electricity rate of about 12 cents.

“When the value of solar exceeds the price of electricity, the solar customer should be credited. Solar provides more benefits than costs, and utilities should act accordingly,” said Seguin.

All 11 of the studies found that solar panel owners offered the electric system as a whole net benefits, including reduced capital investment costs, avoided energy costs, and reduced environmental compliance costs.

“Solar panels on the roofs of Oregon’s homes and businesses means we don’t have to build expensive new power plants; it means electricity is delivered more easily and efficiently; and it helps save the environment to boot,” said Israel.

Solar advocates hoped today’s report would shed new light on the debate over the value of solar, which the Oregon PUC is currently determining. The value of solar investigation could provide additional insights on solar’s benefit to customers and the electricity grid.

“Solar power’s rewards are far greater than its costs,” said Seguin. “We should be encouraging even more solar, not penalizing it.”

Read the full report here.