Example of a group of solar battery panels on the roof of a home. Photo by scanrail

By KIRSTEN LASKEY
Los Alamos Daily Post
kirsten@ladailypost.com

After lengthy discussions and a lot of public feedback, the Los Alamos County Board of Public Utilities (BPU) decided during its April 17 meeting, to postpone a decision regarding revisions to the rule defining how solar customers receive credits for electricity contributed to the grid from their rooftop solar panels, until all the public’s feedback and input can be addressed.

Though a decision was not made during the board meeting, all questions from the public that were raised at the meeting are being reviewed and answered by staff per BPU Chair Robert Gibson’s request. This information will be included when this item returns to BPU for discussion and consideration.

According to the staff report, the proposed change originated with Department of Public Utilities’ (DPU) staff with concurrence from electric rate consultants, GDS.

DPU Deputy Manager Karen Kendall reported that, as proposed, the credit to the customer for energy supplied to the utility would be based on the utility’s total capacity and energy costs under its electric coordination agreement (ECA), using a 12-month rolling average, as calculated from the Los Alamos County Resource Pool invoices.

The staff report explained, “The proposed changes to our solar rule do not impact anything except the billing mechanism. Your home will continue to consume energy from the solar panels while it is producing energy. Any excess produced will continue to flow out through the utility net meter to the grid. This is unchanged functionality for interconnecting with DPU’s distribution system. The energy consumed directly by the home is not metered or measured by DPU and the homeowner avoids the retail cost of this power, which contributes to the installation’s ROI (return on investment).”

Kendall said she knows there are lots of questions about the wholesale costs versus the retail rate and she explained the differences. The retail rate is the basic rate charged to customers for the electricity that they use. It is structured to cover DPU’s costs for wholesale energy plus operational costs. The operational costs include electric distribution system repair and replacement, line personnel, equipment, transformers, etc. The wholesale cost is what DPU pays for purchased power delivered to the local distribution system. The wholesale cost includes power purchases, transmission charges and other demand costs.

What was discovered and what led to the proposed rule change, Kendall said, was that DPU was not correctly following either net metering or net billing. It was a hybrid of the two. People were getting paid the retail rate for energy produced beyond what was used rather than being paid at the wholesale level costs, which was the intention of the rule.

She added this was “purely an issue with our billing system and interpretation, and in reviewing the rule internally and with our consultants, as well as with legal, we determined the need to clarify it.”

The issue raised by solar customers present at the meeting is that by charging customers the wholesale rate for excess energy provided to the County’s electrical distribution system, they receive smaller credits on their bills.

The staff report shows the impact of changing to directly billing at wholesale is $113,782 for calendar year 2023. This equates to reducing the average annual credit per solar producing household by $251.73.

It was reported during the meeting that if approved, the revised rule would take effect May 1 and would not seek to correct past billing. Still, individuals who attended the meeting and spoke during public comment were not pleased with the proposed rule change.

One speaker asked, “Why am I getting billed, or penalized basically, for producing energy?”

He used one example: if his home uses 100 KWH and his solar array makes 100 KWH, then they are dead even. If DPU charges him using a commodity rate that would be $12.82 and the County would only pay him a $7.38 credit, so he would be in the negative for making energy that he used.

Another speaker followed up on this saying, “I think it is unfair that I am not able to use the electricity that I produced first and net out the cost.”

Kendall and Stephen Marez, Deputy Utility Manager, both clarified that energy produced from home solar panels, first provides energy to the home, such as for appliances, television, etc., and then excess energy produced beyond what’s used in the house is delivered to DPU. The solar energy directly used by the house is not subject to any charges from DPU.

Still another person said bluntly, “I think this is an outright crazy idea.”

Another speaker pointed out DPU should consider the message being sent out with this revised rule. It has a goal to be carbon free, but it isn’t giving residents any incentive to utilize solar energy in their homes.

One speaker encouraged the Board to approve the changes to the rule.

In response to this uniform opposition, Gibson said all the input will be accepted, DPU staff will address the concerns and the issue will be returned to BPU as quickly as possible.

“We’ll be considering your comments and trying this again to get closure … that is understandable by more … (and) hopefully something we can all be more comfortable with …,” he said.