Thursday, January 16, 2014 by Michael Kanin

Austin Energy willing to consider changes in solar incentive program

Austin Energy officials Tuesday told members of the Austin City Council’s Emerging Technology and Telecommunications Committee that they are willing to explore changes in the city’s solar incentive program that could allow utility solar customers to roll over credits for surplus energy generation from year-to-year. Under the current policy any credits that solar unit owners have at the end of the year are zeroed out.

 

If consummated, the move would address a concern voiced recently by solar advocates. It appeared to contribute to what sounds like a closing gap between advocates concerned about the utility’s treatment of solar customers. “I think we’re getting somewhere where we can all reach an agreement,” said Solar Austin Board Vice President Kaiba White.

 

However, the committee chair, Council Member Laura Morrison – who had just been told that outdated information about the Value of Solar rate remained in place on Austin Energy’s website – closed the solar portion of the body’s meeting with a loaded summation: “Clearly there is room for improvement, and it looks like we’ll be headed in that direction,” she said.

 

Utility officials angered many in the solar community in late 2013, when they announced that they would reduce the rate used to calculate solar credits given to residential customers who generate solar power. Austin Energy customers who have installed solar units   use that figure to help calculate the rate at which their solar investment will pay for itself.

 

Austin Energy Vice President of Customer Energy Solutions  Debbie Kimberly told Council members Tuesday that – though other factors are involved in the utility’s calculations – the projected decline of natural gas prices factored heavily into the drop in the Value of Solar calculation.

 

Still, Kimberly offered a summation of comparatively increased solar activity from interested customers. “I looked at participation—letters of intent provided by residential customers over the last five weeks; the period of time that correlated most recently with the reduction in the upfront (solar) incentive, but then also the October to December discussions of the value of solar,” Kimberly said. “In the last five weeks we’ve had 55 applications for residential customers coming in under… (the new regime). That is fully two-and-a-half times greater than the same period of time last year.”

 

Later, she offered a caveat about that figure. “I’m not about to say that the last five weeks is any indicator of the future,” Kimberly continued.

 

Kimberly put the “payback period for a brand new solar customer” at the current Value of Solar rate of 10.7 cents per kilowatt-hour at 10 years.

 

Utility officials and Council members also batted about a handful of suggestions that might further incentivize solar investment. These include the notion of a floor for solar credits, and the possibility of fixed credit contracts that could extend for, as pitched by Kimberly, between five and 10 years.

 

Council Member Bill Spelman also wondered if Kimberly and her colleagues could explore a policy that would offer solar customers some level of guarantee about future price fluctuations. Kimberly suggested that this could be another workable possibility.

 

Kimberly’s suggestions focused on potential changes in the solar program for 2015. Advocates continued to push the utility to make amendments in the current calendar year.

 

For his part, Council Member Chris Riley further underscored the Importance of the involvement of solar stakeholders in continuing discussions.

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Key Players & Topics In This Article

Austin City Council Emerging Technology and Telecommunications Committee: An Austin City Council committee charged with looking at issues such as internal electronic communications, I/T infrastructure development, and--insofar as it is related--open government.

Austin Energy: As a municipally-owned electric utility, Austin Energy is a rarity in the largely deregulated State of Texas. It's annual budget clocks in at over $1 billion. The utility's annual direct transfer of a Council-determined percentage of its revenues offers the city a notable revenue stream.

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