Solar groups and utility made a deal because ‘in Utah, we do things differently’

Francisco Kjolseth | The Salt Lake Tribune Artspace Solar Gardens at 850 South 400 West in Salt Lake City, which opened in August 2013, is the first net zero mixed-use energy building with onsite solar production in the state of Utah. Next year will be consumers’ last chance to take advantage of a sizable federal rebate for new solar installations, and cash incentives available through Rocky Mountain Power could be coming to an end as well.

Utah’s recent net metering settlement, negotiated by solar industry leaders and the state’s largest electric utility, is a shining example of using dialogue to solve seemingly intractable problems, according to Gov. Gary Herbert.

“Differing opinions is not necessarily a bad thing,” Herbert said at a Wednesday afternoon news conference scheduled to celebrate the settlement, which was ratified by state regulators late last week. “We have a lot of issues in the state of Utah where we hope we could come together and have a frank, open conversation with civility. That’s what happened here.”

The settlement will allow the state’s largest provider of electricity, Rocky Mountain Power, to slightly reduce the value of the credits it provides to customers whose rooftop solar panels generate more electricity than they use. This “transition” credit rate will remain in place while the utility, solar industry leaders and other parties continue to study the costs and benefits of residential generation in order to determine how much the utility ought to compensate these customers for their excess power.

While the settlement is complex and multifaceted, Wednesday’s speakers primarily focused on the process that brought it about, rather than on the details of the agreement.

Ryan Evans, president of the Utah Solar Energy Association, said industry leaders, the utility, environmental advocates and other parties spent nine months and hundreds of hours to come to an agreement on the issue.

When talks began, Rocky Mountain Power argued that net metering forced its customers who did not have rooftop solar panels to subsidize the electrical bills of those who did. But solar industry representatives and other groups opposed the company’s proposal to restructure solar customers’ electric bills. The resulting rate shock, they said, had the potential to end rooftop solar installations in Utah altogether.

The fact that these two opposing sides were able to agree to a compromise, Evans said, was proof Utah’s method of building consensus works to solve problems.

“This is another feather in the cap of a state that is known for tackling really difficult issues, and as the best state for business,” Evans said.

Herbert said one key to the negotiations’ success was that, despite their disparate perspectives, each of the participants came to the table, willing to hear the others out. He also acknowledged a handful of groups that continue to oppose the outcome.

“I’m not naive enough to think that everybody thinks this is an ideal solution,” he said. But those who participated in the private settlement process did not “let the perfect become the enemy of the good.”

Jon Cox, vice president of government affairs for Rocky Mountain Power, agreed that the settlement was not perfect. He said other U.S. utilities struggling to renegotiate net metering agreements have approached Rocky Mountain Power to ask the utility it they would agree to guarantee current net metering customers’ rates through 2035.

“In Utah, we do things differently,” Cox said.

Rocky Mountain Power, like many other parties, came to the table “in good faith,” willing to listen and negotiate, he said.

In light of that collaboration, other speakers expressed optimism about the study and negotiation to come. Brandy Smith, communications director for Utah Clean Energy, said the advocacy group sees the upcoming discussion as an opportunity to modernize Utah’s energy system.

“This is our chance to get it right,” she said. “We’re going to need government leadership, advocates, and the utility to come to the table and work together, and this settlement is a great first step toward achieving that kind of collaboration.”