Countering utility claims, report says solar panel owners provide net benefits

Media Contacts

Environment America

BOSTON, MA – Homes and businesses with solar panels deliver more 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 Rob Sargent, senior program director at Environment America and the report’s co-author. “If anything, utilities should be paying people who go solar more, not less.”
The Environment America Research & Policy Center report, Shining Rewards: The Value of Rooftop Solar Power for Consumers and Society, comes as at least a dozen states around the country are hotly debating net metering and other programs that promote rooftop solar.
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. 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.  
In other words: utilities were likely underpaying solar panel owners, not subsidizing them.
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.  
“The solar studies reviewed in this report confirm that huge amounts of solar have already been developed without paying the full value that solar brings,” said Karl Rábago, Executive Director of the Pace Energy and Climate Center. “Not only does that mean that solar customers have likely been subsidizing non-solar customers and the utility, but that over the long term, continued development of solar promises downward pressure on electric rates for all.”
Solar advocates hoped today’s report would shed new light on the debate raging in more than a dozen states around the country over how much solar panel owners should be compensated for the power they produce. Nevada, for example, is considering a new fee for solar panel owners who sell excess power. Arizona Public Service is proposing to lower the reimbursement rates for solar power. In Wisconsin, solar advocates are appealing a decision by the Wisconsin Public Utility Board to increase fees on distributed solar customers in We Energies utility territory.
Solar power is widely popular with the American public, and net metering programs to encourage distributed generation of rooftop solar have drawn support from diverse and powerful quarters, from the NAACP to Conservatives for Energy Freedom.
“With African American children being three times as likely as White American children to die from asthma attacks, we see distributed generation of solar energy as an opportunity to break fossil fuel company monopolies that are actively resistant to transition, and offer options for consumers to generate clean energy and create job and small business opportunities to strengthen local economies,” said Jacqui Patterson, Director of the Environmental and Climate Justice Program with the NAACP.
“Until barriers are removed so consumers are allowed to sell their excess power to anyone in a free market setting, net metering is the only alternative,” said Debbie Dooley, founder of Conservatives for Energy Freedom. “Monopolies should pay real fair market value taking into consideration the true value of solar.”
“Solar power’s rewards are far greater than its costs,” Environment America’s Sargent concluded. “That’s why we should be encouraging more of it across the country, not penalizing it.”