NH changes how solar generators are reimbursed for extra kilowatts

Oct 02, 2017

BY: CCNH-LFDA Highlights

When small solar power generators, such as those at a home or business, create more electricity than they use, utilities reimburse them for those extra kilowatts with credits on their bill.

This ability to get reimbursed for putting power back into the grid is called “net metering,” and it is among the most controversial aspects of solar power in New Hampshire.

To read more about solar energy and net metering in New Hampshire, check out our issue page.

Controversy over rates and credits

In the past, if a home generated a kilowatt-hour of solar, it was credited for a full kilowatt-hour of free power at the regular retail rate. However, some utilities argue that when small scale solar generators get paid full price for their electricity, they aren’t sharing in the overhead costs of maintaining the power grid. Theoretically, this shortfall leaves non-solar customers paying more than their fair share.

To avoid this, the New Hampshire Public Utilities Commission recently introduced modest changes in the way solar owners are compensated for the power they produce.

New reimbursement rates for solar energy

The new rule for residential solar projects (those that produce under 100 kw) slightly reduces the rate at which solar panel owners will be paid for the excess power they sell to the grid.

  • Solar owners will still be credited for 100% of the energy they supply.
  • They will also still be reimbursed at 100% of the going transmission rate – the cost of delivering electricity over high-voltage lines between power plants and the local grid.
  • The change is in the distribution rate, which is the cost of getting power over local power lines to individual homes. Solar generators will now receive only 25% of this rate—down from 100%.
  • Importantly, those who set up their solar power systems before September 1, 2017 can still take advantage of the full 1:1 retail rate until the end of 2040.

A fair compromise?

Proponents of the new rules believe the changes strike a fair balance between the needs of utility companies and those of the solar industry. The modest reduction in how much solar generators are paid for the power they produce will help utility companies pay to maintain the power grid without raising rates for non-solar customers. Importantly, those in favor of the new rules believe the changes preserve the incentive for individuals and businesses to invest in green energy.

Opponents of the PUC’s decision say that the changes do not go far enough to make solar generators pay their fair share. If more people invest in solar panels, these rates could mean more of the costs of maintaining the grid are shifted onto non-solar ratepayers. Some believe utilities should be allowed to reimburse solar generators at the wholesale electricity rate—the same rate utilities pay to buy energy on the open market. The money utility companies save could then be used to maintain and improve the power grid.

What do you think—are these new rules fair to all involved? Or, should solar owners play a bigger role in helping maintain the electrical grid? Let us know – yes or no, and why – by leaving a comment below.


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Residential Solar Power | 1 comment(s)
Should NH encourage more residential solar installations?

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