Renewable energy is an important part of the diversified energy mix that we use to provide safe and reliable electricity. In fact, we’ve invested about $1 billion in renewable energy over the past 10 years, including four wind energy centers and a biomass-fueled power plant. In addition, we support customer-owned generation, also known as distributed generation.
Customer-owned generating systems are on-site power sources located at or near a customer’s home or business. Such systems include rooftop solar panels and small wind generators. Customers offset their utility energy needs by using these systems to power their homes and businesses when the sun is shining or the wind is blowing.
All of our customers, including those with their own generation, benefit from access to our reliable electricity grid. When a customer’s system is not producing power, the customer relies on us to provide power and deliver it. Standby generation and the grid are needed to ensure power is available whenever customers need it – at night, in the rain, or whenever their systems are unable to meet their energy needs. Customers also use the grid to sell excess power when their generating system produces more power than they need. As a result, these customers use the grid just as much and often more than customers who do not generate their own power.
Currently, customers using their own renewable energy systems still need to use the electric grid, yet they pay less than their share for their use of the grid. This leaves more of the cost of the grid to be paid by customers who do not have or cannot afford their own systems.
As a regulated utility, we have an obligation to maintain a system that provides reliable service in an environmentally responsible way, while keeping our rates fair and affordable for all customers.
The number of customer-owned generating systems continues to grow as installation costs fall and technology improves. Even with these advances, customers without their own generating systems continue to subsidize – through their energy rates – those who do.
Most customers with generating systems are subsidized in at least three ways:
This means that other customers – customers who can’t afford a power generating system, don’t have a suitable place to put one, or simply don’t want one – are helping to pay for those customers with their own generating systems to use the grid. They also are paying more for the excess energy generated by customer-owned systems than they would if the utility produced the power or bought the energy on the wholesale market from other electricity providers.
We support customer-owned generation – and we support fair rates for all customers. One customer group should not subsidize another, which is why we are proposing that customers with their own generation pay their fair share of the costs for standby generation and their use of the grid. We also are proposing that we (the utility) and, consequently, customers who do not generate their own electricity only pay market prices for the excess power generated by customers with their own systems. For those customers who already are generating their own power under our CGS2, CGS6 and CGS8 tariffs, we’re asking for a 10-year grandfather period. If accepted, those customers may remain on their tariffs until Dec. 31, 2024.
As the number of customers with solar and other renewable devices on their homes and businesses increases, it is even more important that everyone who uses the grid pay their share of the cost to keep it operating reliably. Customers with their own generating systems will continue to benefit from producing renewable energy and off-setting their energy costs.
These changes we propose will allow us to maintain a system that provides reliable service in an environmentally responsible way, while keeping our rates fair and affordable for all customers.