Austin Energy’s innovative approach to compensating distributed solar owners is continuing to receive accolades across the country. In September, Austin Energy received an Innovation Award from the Interstate Renewable Energy Council (IREC). Earlier in the year Austin Energy was named the Solar Electric Power Association’s (SEPA) 2012 Public Power Utility of the Year. For this award, Austin Energy was selected from nearly 300 public power utilities. Congratulations, Austin Energy!

As mentioned in a previous post, development of Austin Energy’s value of solar tariff followed five years of research to price solar by factoring in all the benefits it provides to utilities and ratepayers, including:

  • Loss savings – reduction in system losses by producing power in the same location where it is used.
  • Energy savings – offset of wholesale energy purchases with distributed PV generation.
  • Generation capacity savings – added capacity provided by distributed PV.
  • Fuel price hedge value – offset of conventional fuel price uncertainty with distributed PV.
  • T&D capacity savings – reduction in peak loading on the transmission & distribution (T&D) system, delaying the need for capital investments.
  • Environmental benefits – smaller environmental footprint of PV as compared to fossil-based generation.

Austin Energy is the first major utility to replace net energy metering with gross metering of the output of distributed solar systems. The Austin Energy solar tariff, which goes into effect this month, is initially set at 12.8 cents per kWh. This rate fully reflects the benefits of solar to the grid and is higher than most customers received from net-metered systems.

Clean Power Research was proud to partner with Austin Energy on this research. You can read more about the methods used to design the Value of Solar™ rate in the paper “Designing Austin Energy’s Solar Tariff Using a Distributed PV Calculator.”