Solar Today May June 2015 : Page 23
This case study offers one example of a commercial scale photovoltaic installation that benefits a municipal electric company and its customers. Context The commercial scale EMU PV installation demonstrates that—in this case—a net metered distributed solar generation system does not create stranded costs for non-solar electric util-ity customers. Stranded costs are infrastruc-ture investments that may become obsolete or Copyright © 2014 American Solar Energy Society. All rights reserved. When it was built, Eastern Mennonite University’s solar installation was the largest commercial scale solar project in the state of Virginia. SOLAR TODAY MAY/JUNE 2015 23 EASTERN MENNONITE UNIVERSITY astern Mennonite University (EMU) in Harrisonburg, Virginia, hosts one of Virginia’s largest solar photovoltaic (PV) arrays. Although the electric utility industry in a num-ber of regions has attempted to eliminate net metering on the grounds that solar PV projects hurt non-solar customers through stranded costs, a detailed case study of the EMU installa-tion finds the opposite. Drawing on three years of hourly output and cost data from a 104-kilowatt (kW) rooftop solar array installed in 2010, we found that commer-cial scale solar actually provides a net benefit to the host electric utility and, indirectly, to all citi-zens of (in this case) the city of Harrisonburg, Virginia. Secure Futures, the Staunton, Virginia, solar developer and owner of the 104-kW solar array, developed the research methodology in consultation with the senior management of the Harrisonburg Electric Commission (HEC), a Virginia municipal utility, to focus on energy (kilowatt-hour [kWh]) and power (kW) costs and benefits. This project gained significance as the first solar power purchase agreement (PPA) in Virginia in 2010, and—at the time—the larg-est solar installation in the state. E “stranded” as new, less expensive distributed energy resource (DER) strategies enter the market. The electric utility industry is currently on the offensive against net metered DERs. In their seminal white paper, the Edison Electric Insti-tute refers to the “stranded cost risks” created, in their view, by DER and net metering as the greatest of the “game changers” in the form of a financial “disruptive challenge” to the retail electric business. Berkshire Hathaway Energy, the holding company owned by famed investor Warren Buf-fett, is calling for the elimination of net metering of distributed solar systems. They argue that net metering shifts costs from solar customers to non-solar customers, giving solar customers a “free ride” in using the grid as backup. Many utility companies and their consultants assert that grid-tied distributed solar systems increase stranded generation costs and result in a transfer of wealth from solar customers to non-solar customers. Similarly, American Elec-tric Power has filed with the Ohio State Supreme Court to fight the Public Utilities Commission of Ohio net metering rules. Rapid adoption of distributed solar genera-tion continues to drive a heated debate about whether distributed solar systems impose costs or create benefits for the various electric grid stakeholders. Views range from seeing distrib-uted solar as a disruptive challenge to seeing it as an opportunity for utility companies to posi-tion themselves as first movers in facing the chal-lenges of climate change and sustainability. Solar advocates are fighting back, arguing that electric utility companies cannot compete effectively in providing distributed solar, and their efforts end up costing ratepayers more. Empirical evidence that distributed solar repre-sents a net benefit to electric utility companies and their customers helps bolster advocates’ arguments. This case study offers one example of a commercial scale PV installation that benefits a municipal electric company and its customers. Secure Futures examined the costs and ben-efits of commercial scale distributed solar to HEC, a non-generating municipal utility com-Eastern Mennonite University Solar Project Details Financer and Developer: Secure Futures LLC Solar Contractor: Southern Energy Management Array Size: 104 kilowatts Solar Panels: SunPower 318 Racking: T-10 SunPower Inverter: 100-kilowatt Satcon Array Tilt: 10° Azimuth: 191° Energy Monitor: Locus Energy For more details about the analysis, findings, and references, go to solartoday.org/EMU.