RALEIGH, N.C. (AP) — The largest U.S. electric company wants
to pay North Carolina shops and homeowners less for solar power they
generate by changing a pricing rule that was designed to spur production
of the power, a Duke Energy vice president said Thursday.
If
approved by state utilities regulators, the reduced price would put
rooftop solar power in line with Duke Energy's costs for other
generating methods, including industrial-scale solar farms, said Rob
Caldwell, the vice president of renewable generation development.
Under
current policy for what's called "net metering" set by the North
Carolina Utilities Commission about a decade ago, owners of rooftop
solar systems sign contracts with Duke Energy that allow them to use
electricity generated by the sun and sell any surplus to the company at
11 cents per kilowatt hour. That's the same price households pay for
electricity.
Federal law only requires utilities to pay their generating
cost, which Caldwell said is between 5 cents and 7 cents a kilowatt hour
for Duke Energy's two regional operating subsidiaries. That's what Duke
pays owners of the multiplying number of solar farms. New large-scale
projects pushed North Carolina to behind only California in the growth
of solar-power capacity in 2013, according to an annual research report
by NPD Solarbuzz, which tracks the industry.
The difference
between how much it costs Duke Energy to generate energy and what it
charges residential customers covers construction and maintenance of its
distribution systems, repair, administration and other overhead,
Caldwell said.
"Right now, we need to collect 11 cents for every
kilowatt hour from all across our system to fairly cover the costs of
providing that service. When we give a customer 11 cents for something
that's worth less than that — 5 to 7 cents in our example — that means
other customers are going to have to make that up because our costs are
fixed," Caldwell said.
The energy output of the state's 1,300 rooftop solar panels has
doubled in the past two years, Caldwell said. U.S. electricity demand,
meanwhile, has dropped to around 1 percent growth per year and is
expected to stay that way for decades, according to the U.S. Energy
Information Administration.
Some environmentalists believe Duke
Energy's real aim is preventing a proliferation of rooftop solar systems
from shrinking its customer pool and interfering with its business
model, said David Pomerantz, a Greenpeace spokesman on green energy and
electric utilities.
"This is a power grab by Duke to make sure it
maintains a monopoly on being able to sell electricity in North
Carolina," Pomerantz said.
"The more people who go solar, that's fewer gas plants and coal
plants and nuclear power plants that Duke has to build itself, which it
ends up charging to all of its customers," he said, noting that the
company has raised electricity rates in North Carolina three times since
2009 in large part to reclaim expansion costs.
Changing the terms
under which rooftop solar energy has grown in North Carolina would hurt
businesses like Yes! Solar Solutions, said Steve Miller, co-owner of
the Cary business.
"It will have a negative impact on those of us
that design and sell solar systems," said Miller, whose 12-employee
business has added two workers this month and plans to hire three more
installers this year. "If they want to change it they're really not
supporting net metering, which I think is probably their goal in the
long run. I think the utilities see it as a threat."
Charlotte-based Duke Energy delivers electricity to more than 7
million in the Carolinas, Florida, Kentucky, Indiana and Ohio. It is
the largest U.S. utility as measured by number of customers and market
value.
http://www.businessweek.com/ap/2014-01-24/duke-energy-wants-to-pay-less-for-nc-rooftop-solar
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