Installed solar photovoltaic (PV) capacity more than tripled in the past three years, while installed costs for residential and commercial systems have fallen by about 30 percent. Industry analysts forecast that PV capacity will double from current levels by the end of 2015.
Increased adoption of distributed generation, particularly distributed solar PV, will change utility-customer interactions, cost recovery, and revenue streams. Regulators face the challenge of defining and preparing for the potential rate and revenue impacts of expanded distributed PV. The regulatory context and rate structures governing utilities and owners of residential and commercial-scale distributed PV present both market opportunities and market barriers that will influence the path forward for proliferating distributed PV.
A number of regulatory models and rate design alternatives are available to address the challenges posed by the transition toward increased adoption of distributed PV. In a recent paper, Regulatory Considerations Associated with the Expanded Adoption of Distributed Solar, the National Renewable Energy Laboratory (NREL) teamed with the Regulatory Assistance Project (RAP) to frame these issues, explore the regulatory implications, and examine the options for addressing this growing challenge.
- Sources of costs and benefits from increased adoption of distributed PV;
- How regulatory models indicate different roles and value propositions for consumers, utilities, and non-utility electricity service providers;
- Rate design alternatives and their effect on the value proposition for PV adopters, non-adopters, and utilities; and
- How to frame the discussion with utilities, non-utility participants, and customers as they formulate equitable regulatory and rate design solutions.
Questions? Contact Sue Hinnen at [email protected].