SOLAR TODAY - March 2010

As it develops a community solar policy, IREC is looking at many of Massachusetts’ community solar policies, including the state’s approaches to financing and compensation, for help in determining “best practices.”

IREC believes community solar policies, if well designed, can provide the right policy approach to help all customers support solar development and, importantly, participate in programs they help fund (see “advancing Policies to Promote Solar,” page 39). Community systems can also harness economies of scale that can lower the overall cost of participation in a community system.

In light of these benefits, IREC has set out to create model community solar rules. as we have done with net metering and interconnection, our approach at IREC is to take the “best practices” from what has been implemented thus far and synthesize those components into a policy that is easy to understand and straightforward to implement. although our work is still under way, this article discusses what we believe to be some of the most salient considerations.

Rhode Island uses this approach (except as noted above), and California has taken this approach in allowing multi-family, low-income residents to take advantage of solar generation facilitated by California’s incentive program, the California Solar Initiative. With virtual net metering, participants receive, as a utility bill credit, either a percentage or a kilowatt-hour allocation of the output from a generating facility. This approach maximizes the value to participating customers, because it allows them to reduce their most expensive on-peak energy purchases in the same fashion as customers who net meter from an on-site system. From the participants’ perspective, the result is the same as if they installed arrays on their own roofs.

another advantage of virtual net metering is that the entity most experienced in the role, the utility, administers the allocation of bill credits to participating customers. Centralized billing with the utility also maintains economies of scale in customer billing. In recognition of these benefits, IREC will adopt virtual net metering as a “best practice” approach in its community renewables model.

A particularly thorny issue relates to the extent to which a utility should be compensated for wheeling power from the source of generation to the load it is intended to serve.