What Utilities Can Do for Distributed Solar

What Utilities Can Do for Distributed Solar

Date: 31 Oct 2012 | posted in: Energy, Energy Self Reliant States | 2 Facebooktwitterredditmail

Last week the Minnesota Public Utility Commission had a rare live public comment period on Xcel Energy’s long term planning process (called an Integrated Resource Plan).  At the urging of several fellow clean energy advocates, I gave my 3 minute testimony about the enormous gulf between Xcel’s 10-year plan for solar power and the solar opportunity.

In their plan, the state’s largest electric utility indicated an interest in adding 20 megawatts (MW) of solar power to their Minnesota system (in comparison to a current statewide capacity of around 6-7 MW).  If that seems small, consider that our forthcoming report on commercial solar grid parity indicates an opportunity to construct 940 MW of commercial rooftop solar at a price (without subsidies) that matches or beats retail electricity prices.  The opportunity for residential solar is 2-3 times greater.  Combined, 4400 MW of unsubsidized rooftop solar could compete with utility retail prices statewide by 2022.

In other words, Xcel’s plan is remarkable under-estimate of Minnesota’s likely solar market in the next decade.

Minnesota is a utility-regulated state.  In other words, Xcel is a government-sanctioned monopoly with guaranteed customers and a guaranteed profit.  Being the public utility for half the state means Xcel also has a public responsibility to the citizens of Minnesota, many of whom will want to take advantage of the chance to generate their own power, cut their electric bills, and keep their energy dollars local.

There are several ways Xcel could meet that public responsibility:

  • Conduct and publish a study of the solar rooftop potential in their service territory on all public and private buildings, as has been done in San Francisco, Seattle, New York, and many other places.
  • Publish an interactive, publicly accessible map of available capacity on the distribution system to help guide local distributed generation into locations most beneficial to the grid (as has been done by all three major investor-owned utilities in California).
  • Provide a long-term, but declining incentive for solar power (and other distributed renewable energy) that helps create a stable market for steady growth from today until price parity is reached (like Germany’s feed-in tariff or California’s Solar Incentive).

As a government-sanctioned monopoly, Xcel should enable its customers to make energy decisions that reduce their bills, generate clean energy, and keep their energy dollars local.  It’s the least they can do for their guaranteed shareholder return.

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John Farrell
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John Farrell directs the Energy Democracy initiative at the Institute for Local Self-Reliance and he develops tools that allow communities to take charge of their energy future, and pursue the maximum economic benefits of the transition to 100% renewable power.