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Arizona Corporation Commissioner Bob Burns penned an interesting open letter to constituents about concerns over the existing net metering scheme.
Here is my understanding of how net metering may act to shift electric service costs from customers with net metering for their solar rooftop installations to non-solar customers. There are fixed utility costs of providing the infrastructure to ensure reliable electric service 24 hours a day, 7 days a week, and 365 days a year. At the present time, solar rooftop installations do not always produce the energy required for solar rooftop customers, and do not provide energy 24/7. Thus, solar customers rely on the back-up infrastructure that keeps the lights on whether the sun is shining or not. These circumstances present issues regarding how to allocate costs among customers in a manner that does not require non-solar customers to unfairly bear shifted costs for infrastructure that is also necessary to serve solar customers.
A recent study released by the solar industry concludes that the long-term benefits of rooftop solar systems outweigh the costs by 50% based on the decreased need for the utility to purchase new generation, transmission, and other pertinent factors over the 20-30 year life cycle of the solar system. The study, however, does not allay my concerns related to whether non-solar customers may pay a disproportionate share of the infrastructure fixed costs now and until the presumed point when the system’s benefits to the grid outweigh its costs. A significant percentage of the usage portion of a customer’s electric bill is for fixed cost infrastructure. Solar customers reduce or eliminate the usage portion of their bill. As a consequence, it appears that solar customers may significantly reduce their contribution