Why distributed solar benefits everyone

Recently, Environment America released a comprehensive report reviewing the current literature about distributed solar and net metering. It found overwhelming evidence that distributed solar provides a net benefit to all grid customers, whether they have solar or not. Below is an interview about the report with Rob Sargent, Environment America’s Energy Program Director.

Can you explain what your study found?

The main finding of the study is that, despite what utilities would want you to think, homes and businesses that benefit programs like net metering aren’t benefiting at the expense of non-solar customers. We looked at 11 studies, eight of which showed the value solar customers provide to the grid exceeded the retail cost of electricity. If anything, solar customers are being under-compensated.

For those who may not be familiar, what is net metering?

Net metering is a program that allows customers to get fair credit that power that their on-site solar provides to the electric system. In many states, they get credit based upon the full retail rate. In some states the programs aren’t quite as generous.

What surprised you in your research?

I don’t think there was anything that surprised us. It was affirming. When someone other than a utility does a study looking at the costs and benefits of solar, and does a study with integrity, they conclude that solar provides immense value to the grid that benefits all customers. By helping to lower everyone’s cost, solar homeowners are being compensated for the value they provide. This is the same as someone who builds a transmission line is paid for providing value to the grid. On-site solar is unique. It is at or near where people need energy. It works best when it is needed the most. It is reducing demand that otherwise jacks up electricity prices. Net metering then is a simple and elegant way to give people credit for the value they’re providing.

Can you describe the impact of net metered customers on the electricity grid?

Net metered customers help reduce the cost of power. Over time they’re avoiding the need for new capital and capacity investments. They reduce the need for the building of power plants that may only needed a few hours or days a year. They also reduce the need for development of additional transmission and distribution lines. Net metered customers reduce the financial risk of power, as solar has no fuel cost. Increasingly, solar will help with grid resiliency as more and more storage options become available, because they will have the ability to generate even if larger system goes down because of storms and other disasters. Net metering is probably, especially for residents and small businesses, the single biggest contributor to solar’s progress.

Looking ahead, how do you think these issues around net metering play out?

It’s on us to make the substantive and political case for it. On-site solar is really symbolic of the direction that most Americans would like to see our energy system go. We need to take advantage of that. There’s support for that across the political and demographic spectrum. We need to demand that policy reforms allow the tremendous progress we’ve seen to keep happening.