Distributed Energy Resources

State lawmakers considered more than 50 DG-related bills in Q1

State lawmakers considered more than 50 bills related to distributed generation compensation policies and studies in the first quarter of 2018, a new report from the N.C. Clean Energy Technology Center said.

The majority of bills under consideration related to credit rates for excess generation, studies examining the value of distributed energy resources or costs and benefits of net metering, and aggregate caps on net metering, according to the first quarter 2018 edition of the center’s “The 50 States of Solar” report, which was released April 25. Massachusetts and Virginia considered the greatest number of bills during the quarter.

The report found that 40 states and the District of Columbia took some type of solar policy action during Q1 2018. Specifically, the report finds that:

  • 49 utility requests in 26 states to increase monthly fixed charges or minimum bills on all residential customers by at least 10% were pending or decided;
  • 25 states plus D.C. considered or enacted changes to net metering policies;
  • 17 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;
  • 15 states took policy action on community solar;
  • 10 utility requests in 5 states plus D.C. to add new or increase existing charges specific to rooftop solar customers were pending or decided;
  • Four states had action on utility-owned rooftop solar policies or programs;
  • Three states plus D.C. had policy action on third-party solar ownership laws or regulations.

A total of 149 state and utility-level distributed solar policy and rate changes were proposed, pending, or enacted in Q1 2018.

Policy discussions broadening scope from solar to DERs

While net metering discussions have traditionally focused on distributed solar in particular, state policy proceedings are increasingly addressing the broader set of distributed energy resources, including energy storage and electric vehicles, as opposed to solar photovoltaics only, the report said.

In Q1 2018, several states, including Arkansas, Connecticut, Illinois, Missouri, and New York, were involved in investigating the value of distributed energy resources.

Meanwhile, the report said that although more and more states are studying the value of distributed energy resources or working to develop value-based compensation structures, there has been little convergence in methodologies and resulting values.

It said that two recent studies, a NorthWestern Energy Montana net metering cost-benefit analysis and a Maryland Public Service Commission draft solar cost-benefit study, demonstrate this.

While NorthWestern Energy’s study identified a value ranging from 3.5 to 4.6 cents per kWh, the Maryland draft study identified a value of 25 to 40 cents per kWh.

The report also said that states and utilities are taking unique approaches to community solar program design.

As the number of states adopting community solar policies increases, so has the diversity of community solar program designs, the center said.

It noted that Minnesota is taking a value-based credit approach, Hawaii is moving toward time-varying community solar credit rates, and several other states use a virtual net metering model.

Utilities in North Carolina and Virginia proposed community solar program designs in Q1 2018, with one planning an upfront participation fee and the other planning a monthly per-kWh subscription fee.

The report’s executive summary is available here.