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California’s long-awaited proceeding on distributed solar compensation may offer important answers to new questions about the costs of renewables that will come with the Biden energy transition.
Net energy metering (NEM) compensates distributed solar owners for generation exported to the power system at the retail electricity rate. At low solar penetrations, that may not impose significant costs to other customers. But utilities and solar advocates differ on the cost-benefit balance at the higher penetrations now forecast by the U.S. Energy Information Administration, the Solar Energy Industries Association (SEIA), and others. To get past the controversy, stakeholders across the U.S. are working toward a successor to NEM.