Study finds states should factor environmental-harm reduction into net-metering policies

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According to the Net Metering Practice, by reducing fossil fuel use, enhancing resilience, and improving equity, distributed generation (e.g., electricity generated by rooftop solar panels) can be more beneficial to society. should be revised to reflect the value it can provide to new report Awarded by the National Academy of Sciences, Engineering and Medicine under the auspices of the U.S. Department of Energy.

Commission chair and independent scholar Janet Gale Besser said, “Net meters are just one factor in the broader changes impacting the electricity system, but consumers’ solar panel installations are on the rise. It has proven very successful in increasing energy consumption and reducing our dependence on fossil fuels.” “As a result of this success, the system has reached an inflection point, both technically and economically, where we are revisiting our net meter policy to support the future deployment of value-adding distributed generation. And it really needs to evolve equitably.”

National policymakers and regulators are exploring different variations and alternatives to better meet net metering decarbonisation, equity and resilience goals. For example, in net billing and alternative approaches known as “buy all/sell all”, customers’ electricity consumption is billed at retail rates, but the electricity they generate and contribute to the grid is It may be credited for another fee. Based on the value of electricity to the power system or society.

Equity Considerations Need More Care

Unlocking the potential of distributed generation for a more resilient, equitable and decarbonized power system requires a more purposeful and integrated approach than traditional net metering policies. said the report. Policy makers should consider historical issues with access to distributed generation programs and technologies in low-income areas and the cost implications for those not participating in net metering when updating net metering policies. be.

Interest rates should be designed in a manner that is consistent with modern interest rate-setting principles, with particular attention to the capital impact on the most vulnerable customers. To achieve this, utilities and policy makers should make information about utility rates easily available to all customers so that all customers have a voice and participate in rate design. is needed.

In addition, policy makers should focus on restructuring grids in underinvested communities to reverse historical structural inequalities and enable more widespread and equitable adoption of off-meter distributed generation. Investments such as upgrades should be considered.

Other aspects of net metering could also be improved

Electricity rate decision makers should consider both total benefits and costs, as well as the impact of benefit and cost allocation, when designing net meter policies, to ensure that appropriate data is collected and published. need to do it. These benefits and costs need to be balanced, including public health impacts, employment impacts, land use impacts, and possible or eliminated options in the future. I have.

When determining compensation for distributed generation, decision makers should also articulate the adverse environmental impacts that distributed generation will reduce if it replaces fossil fuels. To fairly compensate for this clean energy attribute, policy makers should either compensate based on the monetary value of the environmental externalities that DG is likely to mitigate, or compensate for similar environmental damage through alternative technologies and policies. Compensation should be considered based on the cost of achieving the savings.

News article from the National Academy of Sciences, Engineering and Medicine

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