Proposed rate changes concern solar proponents
- A cost of service and rate design study proposed changes to Farmington's electric rates.
- Solar proponents are concerned about the added cost for solar arrays that are connected to the grid.
- Farmington residents could see increased utility rates and a minimum bill of $10 a month.
FARMINGTON — A new rate and cost of service study first presented to Farmington's Public Utility Commission in November has solar proponents concerned.
The Public Utility Commission will meet Wednesday and may recommend that the Farmington City Council approve the proposed rate changes.
Solar proponents say a standby service rider for customers who generate some of their own power will discourage new solar development in much of San Juan County and in the portion of Rio Arriba County that is served by the Farmington Electric Utility System.
The standby service rider would mean that new solar customers would pay a set amount based on the size of their array.
"It helps to balance the non-solar customers with the solar customers, so that one is not subsidizing the other," said Farmington Electric Utility System Director Hank Adair.
While solar customers can generate a portion of their own power, the electric utility system has to have enough power on "standby" to provide for the customers if their solar system fails.
Adair said the rider would only apply to customers who install solar after the rates take effect. That means San Juan Regional Medical Center, which installed a solar field this year, would not pay the standby service rider.
Laura Werbner, a spokeswoman for the hospital, said the solar array generates about 1.5 megawatts of power.
She said San Juan Regional Medical Center officials are meeting with city officials Tuesday to "gain a better understanding of the rates."
The standby service rider would also be different based on the type of customer. The largest fee would be levied on the residential class of customers.
The cost of service and rate design study recommends a $7.28 fee per kilowatt of installed capacity on fixed residential solar arrays. That means if the resident can generate 4 kilowatts of electricity using roof mounted solar arrays that do not follow the course of the sun, that customer would pay a $29.12 per month to be tied to Farmington's grid.
A residential customer who has a system that tracks the sun would pay $7.01 per kilowatt capacity, according to city documents. That would mean a 4-kilowatt array would have a monthly $28.04 standby service rider.
Mike Eisenfeld, the energy and climate program manager of San Juan Citizen’s Alliance, is among the customers in Farmington who have a solar array. His system generates about 4.6 kilowatts of power using 20 panels.
While Eisenfeld acknowledged his system would be grandfathered in, he said he is concerned the proposed changes would discourage people from investing in solar.
"Overall, it just seems to penalize people who want to put solar on their homes," he said.
Dave Fosdeck, a Farmington resident who previously worked as a solar integrator in Colorado, also criticized the proposed change.
"It’s just another impediment for solar," Fosdeck said.
Susan Nipper-Greaves, the business operations manager for the Farmington Electric Utility System, said the standby service rider would be an incentive for customers to install the appropriate size array for their usage.
"We do have customers that send back more electricity than we send them," she said.
The changes would make it more difficult for customers to earn a consistent profit from a solar array.
In addition to adding a standby service rider, the utility may also add a minimum charge of $10 for every utility bill and may phase in higher rates over a period of four years.
A cost of service and rate design study found that residential customers are being subsidized by other types of customers. The study recommended phasing in a 7.7 percent increase over four years.
Hannah Grover covers government for The Daily Times. She can be reached at 505-564-4652.