CPS Energy makes revisions to solar-energy fees

Source: San Antonio Business Journal

CPS Energy — after proposing to cut the rates it pays solar users for excess power they generate — says it will keep its original rates in place but add a one-time connection fee for solar users plus a monthly fee of up to $15 to cover the cost of maintaining the electrical grid.

What’s more, the city-owned utility says it’s offering an additional $20 million in rebates to customers who install solar systems, adding to the $30 million it’s already paid out since 2008.

The new fees come after a year-long study by CPS into how it can promote solar adoption while having users pay for their share of grid upkeep, spokeswoman Tracy Idell Hamilton says.

“We had a system that made sense when we had 30 solar customers but not when we have 1,600,” Hamilton says. “This (adjustment) makes it possible for us to continue supporting solar now and into the future.”

Initially, CPS paid customers its standard retail rate for excess power from their installed solar panels. However, in April 2013, the utility proposed cutting that rate in half so it could continue to fund upkeep of the power grid. After complaints from solar installers, the utility shelved the cuts and agreed to further study.

Under the new fee structure, solar installations will require a one-fee to cover the cost of connecting the system to the grid. Residential customers will pay a flat $450, but commercial fees will vary based on system size.

Additionally, solar customers will pay a monthly grid fee of $1 per kilowatt per month to cover the cost of utility infrastructure. For an average residential system, that would be $5 per month.

Those monthly grid fees will grow to a maximum of $15 per month over coming years.

As part of its effort to promote wider adoption of solar, CPS also has freed up an additional $20 million from its CPS Save for Tomorrow Energy Plan, which seeks to cut energy consumption via rebates and efficiency measures. The company, under current CEO Doyle Beneby, has invested heavily in solar-power generation andprojects to improve efficiency.

CPS solar rebates will remain at $1.60 per kilowatt for the first 10 megawatts of rooftop solar installed, with adjustments to that rate for larger installations. CPS’ average solar rebate is $6,000 to $7,000, Hamilton adds.

Rooftop solar installations have grown 400 percent here over the past three years, making the San Antonio area sixth in the nation for installed solar power, according to CPS.

“Utilities around the country are grappling with the same issue and trying to make it work,” Hamilton says of CPS’s new solar rate structure.

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