How much is solar power worth?

In Austin, a solar kilowatt-hour will get you 12.8 cents. In CPS's San Antonio territory, that same solar kilowatt-hour will get you about 5.6 cents from the utility via its Value of Solar Tariff (VOST). The cities have each installed about 10 megawatts of solar.

We're seeing attacks on net energy metering policies (and Renewable Portfolio Standards) across the U.S. Last month, the attack came from San Antonio’s municipally owned CPS Energy.

CPS had revealed, via its homepage, a plan to replace net metering with a different plan called "SunCredits," which calculated the value of consumer-generated solar at about 5.6 cents.

Well, in a statement made today and again via its online blog, the San Antonio utility wrote, "CPS Energy has agreed to delay changes to its rooftop solar net metering program for one year as it works with local installers to come up with an equitable solution." The utility is forming a working group after having recently hosted a town hall with solar installers and stakeholders.

"CPS remains committed to distributed solar power. Its rebate for rooftop systems is one of the most robust in the country. It has already paid out roughly $20 million of $40 million budgeted by 2020. CPS Energy must make sure all customers are still paying to maintain infrastructure, upgrade technology, enable a smart grid and expand energy efficiency programs," according to Cris Eugster, CPS Energy’s EVP. 

Adam Browning tells GTM, "Utility monopolies are granted to serve the public good -- and utilities neglect the fact that solar is incredibly popular and the deep visceral appeal of self-generation at their peril. This is a good outcome that allows all the stakeholders a seat at the table."

It's a question of what is solar worth. And the math involves transmission costs, generation costs deferred, capacity value, loss avoidance and a number of other factors depending on one's worldview. But it also requires a bit of a negotiation, and this has been CPS's negotiation strategy, so far.

Shayle Kann, GTM VP of Research, notes, "After significant pushback from the solar industry in its territory, CPS Energy delayed its SunCredits program by a year in order to have a more detailed dialogue about how to accurately value distributed generation in its territory. This is a question that is being asked, and fought over, across many utility territories in the U.S., including major solar markets such as California and Arizona. The issue is not just how to value individual factors such as avoided generation and capacity, but also what factors to include in the first place. Ultimately, the valuation of solar will shape the future of both distributed generation and utility business models in the U.S. and the early adopters of new models, like CPS and nearby Austin Energy, will provide a benchmark for future utility/solar industry interactions."


CPS Energy’s Internal Calculation of Solar SunCredits in San Antonio

Tags: cps energy, feed-in tariffs, nem, net metering, san antonio, vost