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New Report: Shining Rewards

Solar energy is on the rise in the United States. At the end of the first quarter of 2015, more than 21,300 megawatts of cumulative solar electric capacity had been installed around the country, enough to power more than 4.3 million homes. This rapid growth is the result of pro-solar policies, such as net metering, that encourage more homes and businesses to “go solar” by compensating solar panel owners for the benefits solar energy creates for other users of the electricity grid.

In recent years, however, net metering policies have come under attack in states across the country, threatening further growth in solar energy. Utilities and special interests have argued that net metering acts as an unfair “subsidy” to solar energy generators by shifting costs from solar panel owners to other users of the electric grid.

Frontier Group’s new report Shining Rewards: The Value of Rooftop Solar Power to Consumers and Society shows that, in reality, the opposite is often true. Solar panel owners often deliver benefits to the electricity grid, and to society, which are worth more than the compensation they receive through net metering.

This report reviews 11 recent studies conducted on the value of solar energy, and concludes that:

  • All 11 analyses reviewed found that solar energy brought net benefits to the grid.
  • Eight analyses out of 11 found that the value of solar energy was worth more than the average residential retail electricity rate (the rate many solar panels owners are typically compensated under net metering) in the area at the time the analysis was conducted. The three analyses that found low value from solar power were all commissioned by utilities.
  • Of these 11 analyses, the median value of rooftop solar energy was 16.90 cents per kWh, compared with an average U.S. residential retail electricity rate of 11.88 cents per kWh in 2012.
  • The studies that estimated lower values for solar energy consistently undervalued, or did not include, important environmental and societal benefits that come from generating electricity from the sun.

In order to continue our momentum toward a clean energy future, state and local officials should continue and expand net metering policies, and ensure that a full range of benefits is considered when determining rates of compensation by using a methodology that includes environmental and societal benefits.