Vermont Electric Co-op Seeks Approval to Resume Net Metering
Johnson, VT- Vermont Electric Cooperative (VEC) filed a tariff request with the Vermont Public Service Board (PSB) today seeking approval to resume net metering installations. Net metering enables consumers to generate renewable electricity and receive credits to offset electric utility bills.
In July, VEC reached a cap established by the Vermont legislature which requires utilities to allow net metering systems to be installed in their service territory up to a limit of 4% of the utility’s peak demand. The legislature has given the PSB authorization to raise the cap after analyzing the costs and benefits of these systems. Until it receives authorization to exceed the cap, VEC has stopped approving new net metering system applications. Current participants have not been affected.
“We’ve seen an increasing demand from VEC members interested in using renewable power sources. In particular, demand for net metered solar systems is picking up dramatically,” stated CEO Dave Hallquist. “Now that we’ve reached the 4% cap, this is the appropriate time to assess net metering in Vermont and determine how we can continue to encourage the adoption of renewables in an equitable and sensible manner.”
Under the current rules, VEC members who install net metering systems receive incentivized, above-market credits from VEC for the electricity that is generated. The cost of this subsidy is borne by non-net metering members in their electric rates. At the 4% level, this cross-subsidy costs non-net metering members about $580k per year.
Today’s incentivized rates require VEC to credit net metering systems at 20 cents per kWh produced, even though the costs to install solar are decreasing significantly. VEC’s tariff filing with the PSB proposes that credits should be adjusted to 12.5 cents per kWh for a 10-year contract or 15.8 cents per kWh for a 20-year contract.
“VEC’s proposal provides a solution that would provide fair compensation for electricity generated through net metering,” said Hallquist. “As the competitive marketplace drives the cost of solar down, we believe adoption of net metering will continue to increase without the need for incentives.”
VEC was one of the first utilities in Vermont to reach the 4% cap and today 362 VEC members participate in VEC’s net metering program. VEC believes that solar is an important part of the electric power supply portfolio. With rapidly decreasing prices and the widespread availability of solar options (now including retail outlets), the pace of installations will increase significantly, even with the downward credit adjustments.
For more information please visit our website at: http://www.vermontelectric.coop/renewable-energy/net-metering .