When David Owens, EVP of business operations group and regulatory affairs for the Edison Electric Institute, briefed Wall Street on Wednesday, he was clear in his remarks about rooftopsolar
“I’d like to correct the pervasive misperception that our industry is working to stop rooftop solar,” he stated. “Quite the opposite.”
He then went on to note that residential rooftop solar is the most expensive form of electricity generation in the U.S., at $3.60 per watt, compared to $1.88 per watt for utility-scale solar, citing GTM Research figures.
The figures are accurate, “but that's comparing apples to oranges,” said Shayle Kann, SVP of research for GTM Research. “Residential solar goes to meet a residential customer's load, so the right comparative metric is whatever that customer would otherwise pay for electricity.”
That metric varies across the U.S., but even so, residential solar is increasingly competitive. A study by the North Carolina Clean Energy Technology Center last year found that a fully financed solar PV system costs less than the energy purchased from a residential customer’s local utility in 42 of the 50 largest cities in the U.S.
The prepared remarks were meant to highlight the role of Edison Electric Institute members in supporting rooftop and community solar, as well as utility-scale solar and wind, but in context, they showed an industry organization grappling with a new way of doing business that is arriving faster than some of its members are prepared for.
While some utilities, large and small, are very interested in being the energy services providers of the future, others are digging their heels in. That dichotomy is increasingly clear as EEI speaks for a large industry in flux.
Owens noted that "change" is the buzzword of the electric industry. He called for utilities to be the distribution system operators and grid platform providers, drawing on some of the terminology being used by New York’s Reforming the Energy Vision plan.
He also called for utilities to be able to go behind the meter and invest in cutting-edge solutions. “Rooftop solar customers still rely on the grid and its services around the clock,” said Owens.
In some ways, the organization seems to fail to fully recognize that the new energy economy is already at the doorstep. EEI is bullish on a recovering economy translating into increased electric use, although GDP and electricity consumption have been largely decoupled in the U.S. for at least a decade.
EEI took issue with subsidies for renewables, but also called for wholesale markets that maintain fuel diversity and flexibility, mostly in the form of traditional generation. The organization also criticized the timeline of EPA’s Clean Power Plan, saying that there would not be enough time for the infrastructure upgrades needed to switch to a cleaner power fleet.
“The 2020 interim goals must be substantially revised, if not eliminated entirely,” said Quinlan Shea, VP of environment for EEI, adding, "EPA also failed to consider the electric system as a whole when setting standards and compliance goals.” But a report out from The Brattle Group on Thursday finds that the analysis by the North American Electric Reliability Corporation and assertions by EEI are not necessarily founded and that reliability will not be compromised.
“We find that the concerns raised by NERC about potential reliability issues arising from compliance with proposed carbon emissions standards are largely overstated,” Jurgen Weiss, senior researcher and lead author of The Brattle Group report, said in a statement. “With the tools currently available for managing an electric power system that is already in flux, we think it unlikely that compliance with EPA carbon rules will have a significant impact on reliability.”
During the meeting, EEI’s president Thomas Kuhn outlined some top priority items for the organization in 2015, including grid security, reforming net energy metering to ensure that rates “recognize the value of the grid and address fixed-cost recovery,” tax reform, and advocating that the EPA’s Clean Power plan has “achievable” goals.
Depending on how effective EEI’s lobbying is on the latter point, it could work against the vision that Owens laid out in the same discussion, calling for more microgrids, storage, energy efficiency, demand response, along with “innovative thinking, not to mention a cleaner generating fleet.”