VALUE OF SOLAR METHODOLOGY
In the US, there is currently no uniform approach to establishing a value for the electricity produced by distributed energy systems. Agreements between customers and their utilities vary from state to state and utility territory to utility territory based on state law, utility commission rules, and utility disposition. As utilities look to address dramatic increases in customer adoption of distributed energy resources like solar PV and their own interests in deploying renewable generation facilities, the implementation of valuation methodology can help define costs and benefits.
The methodology, known as Value of Solar Methodology, takes into consideration the unique nature of solar PV generation in which systems produce electricity on peak, produce power at the location of use, do not require continuous fuel purchases, and have significant security and environmental advantages over fossil fuels. These characteristics generally increase the value of solar electricity as they allow utilities to avoid the costs of fuel, plant O&M, generation, reserve capacity, transmission, and distribution in their centralized assets.
Value of Solar Methodology represents an opportunity for states and utilities across the country to begin to assess the benefits of distributed generation and better plan for energy investments that provide maximum benefits to society.
Valuation studies can help utilities, regulators, and policy makers to:
- Evaluate Existing Net Metering Programs
- Design Community Shared Solar Tariffs
- Value Exported Solar Energy
- Determine Qualifying Facilities Rates
- Evaluate Real Time Pricing with AMI
- Advance Value of Solar Tariffs
To help advance dialogue around the appropriate value of distributed solar resources in Wisconsin, Iowa, and Michigan, the Midwest Renewable Energy Association (MREA) contracted with Clean Power Research to develop recommendations for solar valuation.
VALUATION METHODOLOGY RECOMMENDATIONS
Click on a state below to view the valuation methodology recommendations developed by Clean Power Research.