A new report from the NC Clean Energy Technology Center reports that 45 states and the District of Columbia took some type of solar policy action during 2017, while in the fourth quarter of last year, 42 states and the District of Columbia took some type of action on distributed solar policy or rate design.
The report, “50 States of Solar,” was released by the center on Jan. 24.
The quarterly series provides insights on state regulatory and legislative discussions and actions on distributed solar policy, with a focus on net metering, distributed solar valuation, community solar, residential fixed charges, residential demand and solar charges, third-party ownership, and utility-led rooftop solar programs.
“State and utility solar policies continued to undergo review in 2017, with nearly every state in the country considering policy or rate design changes – a trend which is likely to continue through 2018 and beyond,” the center said in the report.
A total of 249 state and utility level distributed solar policy and rate changes were proposed, pending, or decided in 2017, the center said. This represents an increase in activity over both 2016 (212 actions) and 2015 (175 actions.)
The report said that in 2017:
- 84 utility requests in 35 states plus D.C. to increase monthly fixed charges or minimum bills on all residential customers by at least 10% were pending or decided;
- 31 states plus D.C. considered or enacted changes to distributed generation compensation policies;
- 21 states plus D.C. formally examined or resolved to examine some element of the value of distributed generation or the costs and benefits of net metering.
- 21 states took policy action on community solar.
- 19 utility requests in 10 states to add new or increase existing charges specific to rooftop solar customers were pending or decided.
- Eight states had policy action on third-party solar ownership laws or regulations; and
- Six states had action on utility-owned rooftop solar policies or programs.
Top solar policy trends of 2017
The report also detailed what it said were the top solar policy trends of last year.
One of those trends is the convergence toward net billing “as the new net metering,” the center said. “Thus far, the majority of states issuing net metering successor tariff decisions have opted to move to a net billing policy, allowing behind-the-meter consumption but crediting all exported energy at a rate other than retail,” the report noted.
In 2017, Florida public power utility Jacksonville Electric Authority and the states of Indiana, New York, and Utah approved transitions from net metering to net billing, the center said. Net billing models are under consideration in several additional states, including Arkansas, Louisiana, and Michigan, according to the report.
Another 2017 policy trend listed in the report is solar plus storage eligibility emerging as a key net metering consideration.
The report said that several states, including Colorado, Massachusetts, New York, and Rhode Island, continued or initiated investigations into the net metering eligibility of solar plus storage systems. Meanwhile, the Hawaii Public Utilities Commission approved a new compensation tariff specifically for solar-plus-storage customers, the center noted.
A third trend that emerged last year is states considering time-varying rates for distributed solar customers.
“As states and utilities examine net metering successor tariffs and rate design changes for distributed solar customers, time-varying rates are gaining attention. In New Hampshire, regulators initiated a time-varying rates pilot program, while a pilot is also being designed in Maryland. The Vermont Public Service Department recommended exploring time-varying rates for net metering customers,” the report said.
Top 10 most active states in 2017
While nearly every state in the country took some type of action on distributed solar policy or rate design during 2017, some states were particularly active, taking many different actions or especially impactful actions, the report said.
NC Clean Energy Technology Center said that 10 states in particular stood out in 2017 for their solar policy activity: (1) Nevada, (2) North Carolina, (3) New York, (4) Hawaii, (5) Maine, (6) Arizona, (7) New Hampshire, (8) Virginia, (9) Michigan, and (10) Utah.
Fourth quarter activities
In the fourth quarter of 2017, 42 states plus DC took a total of 141 actions related to distributed solar policy and rate design, the center reported.
Of the 141 actions catalogued, the most common were related to residential fixed charge and minimum bill increases (49), followed by distributed generation compensation policies (39), and DG valuation or net metering studies (21).
The report said that five of the fourth quarter’s top solar policy developments were:
Maine regulators delay implementation of new DG compensation rules: In December 2017, the Maine Public Utilities Commission ordered that implementation of the 10% transmission and distribution credit rate reduction portion of the state’s new DG compensation rules be delayed until May 2018. The reduction was set to take effect beginning in January 2018;
Louisiana Public Service Commission Staff publishes proposed net billing, community net metering: The Louisiana Public Service Commission staff filed its proposed modified net metering rules in November 2017 as part of the state’s ongoing net metering proceeding. The proposed rules take the form of net billing and credit excess generation at an avoided cost rate. “Notably, utilities may propose ‘innovative’ methodologies for calculating avoided cost, and the rules would allow community net metering in the state,” the report said;
Public Utilities Commission of Nevada orders decrease in Nevada Power residential fixed charge: Although Nevada Power had requested an increase in its residential fixed charge, the utility withdrew the request in November2017, “following strong public pressure,” the report said. In December, the Public Utilities Commission of Nevada ordered a decrease in Nevada Power’s residential fixed charge, as well as its volumetric charge;
Jacksonville Electric Authority approves net metering successor: In October 2017, Jacksonville Electric Authority’s Board of Directors approved a move from net metering to a net billing program, in which customer-generators will be credited for excess generation at a rate of 3.25 cents per kWh. Existing net metering customers will be grandfathered for 20 years; and
Hawaii Public Utilities Commission approves final community solar rules: The Hawaii Public Utilities Commission issued an order in December 2017, establishing final rules for the state’s community solar program. The program will take a phased approach, using flat credit rates for participants in the first phase (based on mid-day rates) and moving to time-varying credit rates in the second phase. The second phase will also offer special peaker credit rates to facilities delivering at least 85% of their output during peak periods, and allow utilities to develop, own, and/or operate projects as long as at least 50% of subscribers are from low to moderate income households.
The report’s executive summary is available here.