Report: Utilities vastly undervalue solar energy

Media Contacts

Environment America

CHICAGO, IL – 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 Bret Fanshaw, Solar Program Coordinator with Environment America.  “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 utilities across the Midwest attempt to increase charges on solar customers.

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. 

“Across the Midwest, we have seen utilities question the value of solar without supporting data. Using independent data and evidence, this report confirms what we have long known – when solar panels go up, everyone benefits,” said Brad Klein, senior attorney with the Environmental Law & Policy Center.

Solar advocates hoped today’s report would shed new light on the debate raging in states across the Midwest over how much solar panel owners should be compensated for the power they produce. 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.

“Wisconsin citizens and businesses that ‘go solar’ actually provide benefits to all power customers, contrary to what some of our power companies who undervalue solar like to tell us,” said Tyler Huebner, Executive Director of RENEW Wisconsin. “This report shows how other states are demonstrating that value. It would serve Wisconsin well to embrace solar energy as a key in-state resource to power our economy, create local jobs, and save people and businesses money on their electric bill.”

Similar debates are also underway in Iowa, Michigan, Illinois, Ohio, Indiana and Minnesota, as well as many other states around the country.

“With rooftop solar power, electricity is delivered more easily and efficiently and it helps save the environment to boot,” said Michael Noble, Executive Director of Fresh Energy.

Midwestern energy advocates pointed to states like Minnesota as an example of where existing solar programs like net metering and community solar are helping to drive solar development.

“It’s clear that solar energy provides tremendous value to everyone,” said John Kearney, Executive Director of the Minnesota Solar Energy Industries Association. “Minnesota should continue to be a leader in solar energy to reap the vast benefits, which include good local jobs, cleaner air and stable electricity prices. Increasing fees on solar customers simply does not make sense.”

“Solar power’s rewards are far greater than its costs,” said Environment America’s Bret Fanshaw. “That’s why we should be encouraging more if it across the Midwest and across the country, not penalizing it.”



Environment America Research & Policy Center is a statewide advocacy organization bringing people together for a cleaner, greener, healthier future.