Rural Electric Cooperatives to adjust solar connection fees

By Virginia Rutter on January 8, 2018

About a third of Minnesota residents receive their electricity from a rural electric cooperative. If you receive your electricity service from an electric cooperative, you aren’t just a customer, you are an owner as well. Electric cooperatives’ member-owner model is supposed to make these utilities more responsive to their members’ concerns than a traditional investor-owned utility. Unfortunately, when it comes to empowering their customers to benefit from solar, this is not always the case. Many cooperatives have imposed unfair fees on their member-owners. A recent decision by the Minnesota Public Utilities Commission (PUC) could change this.

This fall, the PUC unanimously voted that rural electric cooperatives must change the way they calculate the fees they have imposed. About half of the state’s 45 cooperatives had started charging connection fees for customer generation. The cooperatives were basing these fees on the revenue the cooperatives had lost through customer-generated electricity, which was not tied to any extra costs from the distributed solar.

The PUC ruled the cooperatives must now base these fees on the costs of service, which means the actual costs to deliver electricity service to those customers. This should result in a reduction of fees to these customers. We expect the cooperatives to announce the new fee structure later this year. Greater transparency in utility fees and the removal barriers to residential solar ownership is good for all customers. If you are having trouble with your electric cooperative and would like some assistance, please contact us.