Community Solar Credits at Risk in Colorado

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Community Solar

Subscribers may start to see a reduction in their community solar credits in Colorado. Recently, the Colorado Solar and Storage Association (COSSA) issued an appeal in response to a change in policy instituted by the Colorado Public Utilities Commission (PUC). According to COSSA, the new rules laid out by PUC would reduce the community solar credits provided to subscribers for being part of the program.

The rule allows utilities to deduct the demand-side management cost adjustment (DMSCA) on the subscriber’s bill. As COSSA points out, this would effectively reduce the amount of the credit that the subscriber receives. COSSA has been at the helm of discussions against this rule and has spearheaded a fight against PUC since December 2019, when the Public Service Company of Colorado initially proposed the change. 

Despite being vocal against the policy, COSSA’s request for a petition was disregarded by PUC. In response, the association filed an official appeal request with the Colorado District Court on Sept 28. PUC’s decision to allow utilities to charge fees is an unusual move, considering Colorado was one of the first states to initiate community solar legislation to increase the presence of community solar farms. 

As the law currently reads, subscribers receive a monthly credit, or “net metering credit. This includes a deduction for the transmission and distribution costs that go to the utility provider for being the middle man between the garden and the customer. This fee, also known as the DSMCA fee, goes right back to utility companies like Black Hills Energy and Xcel Energy and generates millions in revenue to the companies. 

According to a brochure from Xcel Energy, who supports PUC’s rule, the fee is calculated at $.2 per kilowatt-hour. In 2019, the fee brought in $23.7 million for Xcel, which was sunk back into residential efficiency and demand response operations.

COSSA fears that the reduced community solar credit will negatively impact the draw toward community solar. Xcel, on the other hand, fears that removing the fee will force the cost of the community solar programs to fall on its other residential customers. Joining COSSA in concerns over the DSMCA fee is the nonprofit Vote Solar.

Vote Solar representatives have stated that a potential increase in the DSMCA for transportation electrification plans could result in a 37% fee increase against subscribers.


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