By Gwen Kautz, Dawson PPD General Manager
gkautz (at) dawsonpower.com
308-324-2386
I was surprised by a question asked recently. They were wondering why Dawson PPD wasn’t fearful of losing sales to solar installation. Of course, we don’t want to lose sales; but if that were a primary concern, we would have never promoted energy efficiency. We started that in the 1970s when the energy crisis loomed large. I’m old enough to remember when interstate speed limits were lowered to 55 mph in order to force fuel savings.
Seven years ago, Nebraska adopted a net metering statute for systems 25 kW or smaller*. Essentially, it states that your utility will take the kilowatt hours you generate and subtract out the kilowatt hours you use and bill you (or credit you) for the difference.
So, how do solar installations affect us and our customers? More importantly, how could your neighbor’s system affect you?
Gwen Kautz, Dawson Public Power District General Manager
First, it’s important to know that we buy power from Nebraska Public Power District. It’s power we can count on 24 hours a day, 7 days a week. It’s also important to note that if there was a shortage of power (for whatever reason), NPPD has the mechanisms in place to buy it from the market. They maintain a reliable supply of power to meet all of Dawson PPD’s customers’ needs.
So, the question becomes…how do the solar panels your neighbor put up affect you financially? It shouldn’t have any effect providing Dawson PPD prevents cost shifting – and we believe we are. In other words, any solar installation by any customer should not be subsidized by any other customer. How would subsidization happen? Well, we could pay a rate to that solar customer that is greater than the rate we pay Nebraska PPD. We have to use a calculation to arrive at the right price, which includes billing factors that affect generating and billing peaks. That price is slightly different for every utility. Customers don’t want to over-size a solar system because that could reduce your maximum benefit from Dawson PPD’s net metering rate.
Another way to prevent cost shifts is through our regular rates for electricity. A few years ago, Dawson PPD knew that our rate methodology was old-school and needed to be changed in order to protect utility infrastructure and maintenance. Customers were already paying a “distribution charge” but it was called a “minimum charge” and included 100 kilowatt hours (@ 21.5 cents/kwh) for $21.50. Every month we were guaranteed at least $21.50 from every meter. A cost of service study showed that our fixed operating costs were closer to $28-$35 per General Service account. We implemented a distribution charge and did away with the first 100 kilowatt hour block. When we did that, we also reduced the price of kilowatt hours.
How about electrically, how will a solar installation down the road from you affect you? Again, the answer is it shouldn’t. Dawson PPD requires specific interconnection standards. Standards that put safety first. Safety for our linemen, for our system and for you. Excess electricity generated by a solar system simply flows back onto our lines and moves on to the next entity willing to consume it.
If you are considering a solar installation, please call us. We can give you a list of questions you may want to ask potential contractors and historical account data that will help your contractor size your system.
As the Christmas season unfolds in front of each of us, remember why we celebrate. It isn’t about presents, decorations or food – it’s about the birth of a glorious Savior. Merry Christmas everyone!
*Other standards apply. See Nebraska State Statute 70-2001 through 70-2005 for details.
December 2016