The Value of Solar: Assessing the Benefits, the Costs, and What it May Mean for Net Energy Metering
According to the U.S. Department of Energy, installations of solar photovoltaics (PV) have grown from 1.2 GW in 2008 to an estimated 30 GW today, generating enough electricity to power the equivalent of 5.7 million homes. This dramatic increase is raising questions—and some controversy—about the value solar generation brings to the grid. How this value is defined has a marked effect on how it is reflected in compensation rates for generators, often through mechanisms like net energy metering (NEM), as well as how the value is reflected in the compensation framework for PV customers. Some utility regulators are motivated to consider alternatives to NEM.
In a webinar held on September 22, 2016, Jim Lazar of RAP and Dr. Thomas Vitolo of Synapse Energy Economics delved into questions surrounding the value of solar, including an examination of the relative merits of various types of value of solar studies, cost recovery methods, and how results from these studies can affect rate design and compensation for PV customers.