Input Needed: Distributed Generation Rates and Community Solar

Overview

Almost every day you can see a new headline announcing advances in clean, renewable energy. It’s also a hot topic in Stillwater.

In early 2020, the Stillwater City Council passed a resolution expressing a commitment to transition to 100 percent clean, renewable energy and forming a citizen “Renewable Energy Task Force."

Now, Stillwater City Council sitting as trustees of the Stillwater Utilities Authority (SUA) will address energy-related issues, including distributed generation, community solar, and renewable energy certificates.

Distributed Generation

Stillwater Electric Director Loren Smith said, “The current distributed generation rate is an industry-standard design; however, we realize the billing process is difficult to understand. While the SUA trustees adopted the current distributed generation rate in 2018, we feel a need to revisit the topic and get public input to see if adjustments are needed to the program.”

Distributed generation refers to a variety of technologies that generate electricity at or near where it will be used, such as solar panels on residential houses.

“The SUA is looking at how to equitably credit and bill customers who use distributed generation. We are seeing customers signing solar panel contracts without having a clear understanding of the methodology the City of Stillwater uses for calculating credits on customer’s electric bills,” Smith said. “The City wants renewable energy in our community.”

In fact, one of the City’s strategic priorities is to provide reliable utility service that meets the needs of today’s customers as well as to anticipate future ones, and that means opportunities for renewable energy.

In addition to distributed generation, the City of Stillwater is exploring opportunities for customers to purchase renewable energy through programs like community solar and renewable energy certificates.

Smith said, “If you want to purchase solar energy, but don’t want solar panels on your home, we are looking at establishing a community solar farm at the Stillwater Energy Center. However, we need public input on what this program would look like.”

Another program would allow customers to purchase renewable energy certificates called RECs. The certificates represent actual energy produced by renewable power sources. Although the energy is not actually delivered to the buyer, by purchasing the certificates the customer receives the benefit of using renewable energy.

Renewable Energy Options

Smith explained that SUA wants to explore additional options for customers who want options for clean, renewable energy. The optimal mix of programs and how best to fund such programs are among details the SUA will have to address. “This is part of why the public input is so important,” he added.

In a recent FlashVote survey, 29 percent of Stillwater residents indicated that they would be willing to pay 1 to 10 percent more for power produced by a community solar farm. Another 25.3 percent said that they would be willing to look at a community solar farm if there was no additional cost associated with it.

Smith said he is looking forward to the Oct. 19 SUA meeting when the Grand River Dam Authority (GRDA) will present its new community solar program and discuss revisions to its distributed generation policy. The City of Stillwater purchases its wholesale electricity from GRDA.

Next up for SUA is a Utility Rates Study Session on Monday, Oct. 26 and a breakout session on distributed generation tariff rates on Monday, Nov. 2. SUA has contracted LM Vedder Consulting to provide services regarding 1) Distributed Generation Tariff Review and Modification; and 2) Community Solar and Renewable Energy Certificate (RECs) Rate Design.

Public Input Opportunities

LM Vedder Consulting will also host a Zoom public input session for distributed generation on Thursday, Nov. 12 at 5:30 p.m. Information on how to access the meeting will be posted on the City of Stillwater’s website stillwater.org.

Smith said, “The public has a vested interest in their energy options. We need input so we can build the best program we can.” Public input will focus on three alternative rate design proposals for distributed generation.

LM Vedder Consulting will then focus on community solar and REC rate design. Smith said, “Again, public input is critical, especially for a new concept for Stillwater like community solar.”

A Zoom public meeting on community solar and REC rate design is planned for early December.

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