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The Holes in Rocky Mountain Power’s Arguments

Rocky Mountain Power offers a lot of words to justify their claims that a monthly NEM fee is justified but those claims revolve around only one aspect of residential renewable energy: recovering the cost-of-service portion of the bill supposedly not paid because of how net-energy works. They claim that this is ‘cost shifting’ and represents a heavy burden borne by the other customers.

Here is how RMP characterizes the solar residential customer:
  • The solar customer is no longer typical of the average residential customer.
  • The solar customer requires the same infrastructure.
  • The solar customer does not reduce their peak load requirement.
  • The solar customer does not consume as much grid electricity as they did before installing solar.
  • The
Because of these differences, RMP claims that the solar customer:
  • doesn't pay their “fair share” of the infrastructure costs,
  • 'shifts' those costs to other customers,
  • is making the other customers pay for their solar system, and
  • is still consuming just as much electricity as they were before installing solar.

We will examine each of these claims in detail in a moment, but first let's ask ourselves, “Okay, but what is Rocky Mountain Power not telling us?”

The short answer is, “They are not telling us about all of the benefits of residential renewable energy.”

Here’s a short, partial list of benefits*:
  • Elimination of millions of pounds of CO2, NO2, NOx and other pollutants.
  • Reduced cooling heat transfer to water in our lakes, rivers and streams.
  • Improved distribution of the electrical supply easing the burden on critical high-tension lines.
  • Reduced load on the system, especially during peak load times.
  • Postponed or eliminated costs associated with system improvements, transformer and switch upgrades, and new high-voltage distribution lines.
  • Reduced load on the system, especially during peak load times.
  • Reduced dependency on non-renewable sources of energy such as coal and natural gas, saving those resources for other, more valuable uses.
These benefits represent a value to every citizen of Utah, benefits for which the citizen pays nothing.

And there actually is one cost Rocky Mountain Power hasn’t mentioned:
  • The large investment many home owners have made in renewable energy for which they’ve not asked RMP or the citizens of Utah one penny in compensation.
The “Heavy Burden” of 3½¢

Rocky Mountain Power is also not telling us how big that “heavy burden” is that is supposedly being ‘cost-shifted’. Like RMP, let’s just for a moment ignore all of the benefits of residential renewable energy, and just ask, “So how big is this heavy burden being cost-shifted to other residential customers?”

Another excellent question! Using RMP’s numbers, it comes down to 3½¢ per customer per month. Yes, less than a nickel a month. We will get into the exact calculation of this on another page but we’d like to assure you that each residential customer is paying far more than that per month for executive bonuses paid to RMP’s leadership.

And one final question, “Is this cost-shifting really going on?”

No. If RMP’s NEM fee had been approved then they would now be recovering double the costs they claim are being shifted. They would be double-dipping. We will prove this.

The Bottom Line

UCARE asserts that the cost-shifting claimed by RMP is, in fact, not occurring.

We also assert that the benefits of residential renewable energy far outweigh any costs. Further, we assert that Rocky Mountain Power wants to suppress or eliminate privately owned residential renewable energy because such energy represents a threat to their monopolistic control of electricity not only in Utah, but across the Western States.

A toe-hold was achieved by this ALEC-backed effort in Arizona where a proposal was put forth to charge NEM customers $50 a month. Fortunately, this was reduced to $5 a month. Unfortunately, the fee was not denied and Arizona has now seen a dramatic drop in residential investment in renewable energy, thousands of jobs in the solar industry have been lost, and the monopoly has won.

RMP Claims

* — Some excellent, thorough studies have been performed on the impact of solar PV. Here are a couple:

Updated on Nov 13, 2014 by Mike Rossetti (Version 17)