Major Utility Wants Lower Net-Metering Rates
North Carolina's Duke Energy will seek a lower reimbursement rate for customers who supply the grid with solar-generated power
Duke Energy in North Carolina wants to pay homeowners less than the retail price for the photovoltaic(PV) Generation of electricity directly from sunlight. A photovoltaic cell has no moving parts; electrons are energized by sunlight and result in current flow. power they sell to the grid.
According to published reports, including an Associated Press story published by Businessweek, the utility will seek permission from state regulators to lower net-metering rates from the current 11 cents per kilowatt hour to a number that reflects the cost of generation--between 5 cents and 7 cents per kWh.
The North Carolina Utilities Commission established rules about 10 years ago in which homeowners with PVPhotovoltaics. Generation of electricity directly from sunlight. A photovoltaic (PV) cell has no moving parts; electrons are energized by sunlight and result in current flow. systems were to be paid the full retail price for any excess power they produced. But a company official says federal law requires Duke to pay only the generating cost.
"Right now, we need to collect 11 cents for every kilowatt hour from all across our system to fairly cover the costs of providing that service," said renewable generation development vice president Rob Caldwell. "When we give a customer 11 cents for something that's worth less than that--5 to 7 cents in our example--that means other customers are going to have to make that up because our costs are fixed."
North Carolina has doubled its output from rooftop solar arrays in the past two years, the AP quoted Caldwell as saying, while demand for electricity in the U.S. has shrunk slightly.
David Pomerantz, a spokesman for Greenpeace, called Duke's intent a "power grab to make sure it maintains a monopoly on being able to sell electricity in North Carolina," the AP reported.
Utilities raise the same issues elsewhere
The North Carolina flap isn't unique. Similar arguments are being raised by utilities in other states, including California, Arizona, and Hawaii. Power companies contend that high reimbursement rates paid to homeowners with solar installations unfairly penalize nonsolar families, who end up paying an unequal share of maintaining the utility's grid.
Duke CEO Jim Rogers in March called the proliferation of solar panels a "potential threat to us over the longer term and an opportunity in the short term," according to an article posted at renewableenergyworld.com.
"If the cost of solar panels keeps coming down, installation costs come down and if they combine solar with battery technology and a power management system, then we have someone just using us for backup," he said.
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