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Members with solar homes to receive less from PEC for excess power

PEC solar interconnect rate

Pedernales Electric Cooperative generated this chart to display the board-approved changes in the buy-back rate for home-generated solar power. After the second and final vote at the Dec. 17 meeting, the new rate will go into effect March 1, 2022. Courtesy image

The buy-back rates for individual solar energy generation will be 4 cents less than what the Pedernales Electric Cooperative charges those same customers for electricity purchased, despite repeated pleas from the co-op’s solar members to delay the decision. The new rates will take effect March 1, 2022, the PEC Board of Directors voted at its Dec. 17 meeting — the second and final vote on the issue.

Currently, the buy-back rate equals the price of electricity used in a solar-powered home: 9.347 cents per kilowatt-hour. The new rule changes the buy-back rate for excess electricity generated by solar members to 5.377 cents, a 42.5 percent cut.

The change was first proposed about a year ago and has generated heated debate between the board and its solar members ever since. The board agreed in the fall to conduct a value of solar study, which it made public two days before taking the first vote on the changes at the Nov. 19 meeting.

Members with solar panels on their homes or businesses questioned the validity of the value of solar study done in October and November as the study did not consider the cost of carbon-based electrical generation on the environment. 

“You say this is all about money, but what you are voting on today is not about money,” said PEC member Gregory Squires. “Look at the human side of this. If this rate is put through, it is going to kill residential solar in PEC. Those who have it are going to be hurt by it, and no one else will go online with it.”

Squires, along with several other solar panel owners, asked the board to show the world that PEC “is environmentally friendly and forward looking.”

“The study we had was incomplete,” he continued. “It needs member input to give a complete picture. I encourage you to postpone this vote until you get that.” 

Two state representatives with PEC members in their districts attended and asked to speak. Rep. Erin Zwiener (D-District 45), whose district includes Kyle, was allowed without question because both her home and her district office receive service from PEC.

“Please delay and have more conversations about this matter,” she said. “PEC serves a beautiful area, but an area that is more vulnerable to the pinch of a changing climate. This is something I hear from constituents, which are almost all members of PEC. They are concerned with these shifts.”

Rep. Vikki Goodwin (D-District 47) sent a letter to the board before the meeting asking for a delay. As she is not a PEC member, she was at first denied her three minutes at the podium. After the pubic comment section ended, the board took a five-minute break that ran 20 minutes long. Upon return, Board President Emily Pataki explained that Goodwin would be allowed to speak because one of the members who had signed up had left and did not take their three minutes.  

“We had some questions about if this person (Goodwin) was able to speak under the members’ rules we have, but there are some questions as to a commercial account,” Pataki said. “We had someone who signed up but did not use his time, so if it’s OK with everybody, we are going to allow this person to speak.” 

Goodwin noted as she began her remarks that many of her constituents in West Travis County are PEC members.

“Solar power being clean energy is something we should be encouraging and incentivizing,” she said. “We are going to have to take some bold steps to include energy like solar. Your members want solar. You had 97 who want to hook up to solar just in December. I think what you are doing here is heading in the wrong direction. I hope you will at least delay the vote on this action today.” 

Without a market rate for carbon, the PEC cannot put a dollar amount on the environmental benefits of solar, Chief Financial Officer Randy Krueger explained at the beginning of the meeting before member comments.

“The best way to do this is that anything we pay is tied to a market rate,” he said. “There is no market rate for carbon. If legislation is passed to provide a rate for carbon, then we would include that.” 

He also pointed out that 24 percent of electricity the PEC sells to its members comes from renewable energy. PEC does not generate its own power but instead buys it at market rate and transmits it to members on its own equipment. 

“What a lot of folks don’t appreciate is that PEC has one of the largest renewable portfolios than any other public utility in the United States,” he said. “We find it, in many cases, is the most cost-effective way. This is about fairness and doing what is in the best interests of the members as a whole.” 

Of the PEC’s more than 300,000 members, about 6,100 of them have distributed generation, or solar, installations — about 1.7 percent of the co-op’s total membership.

“The newly adopted Sustainable Power Credit is 5.377 cents/kWh and is greater than what’s offered by many other electric cooperatives across the state,” stated a media release sent out after the Dec. 17 meeting. “This rate is designed to pay solar members for their excess power at the market value of power plus any system benefit. This means that under the new rate, solar members will be compensated by more than 30 percent of what PEC pays for average wholesale electricity.

Public Citizen, a nonprofit consumer advocacy organization that has joined in opposing the decrease in the buy-back rate, does not plan to give up on its efforts to lead PEC toward more solar-friendly policies and rates. 

“The next steps for PEC members is to get more involved in PEC elections,” said Kaiba White, climate policy and outreach specialist with Public Citizen. “The board looked very different seven years ago, therefore the staff looked very different. The general manager was supportive of solar and renewable energy generally and hired staff that were not only supportive and had expertise but was looking for ways to help PEC members use more solar at homes and businesses.”

She disagreed that abolishing net metering — paying the same for solar-generated power from members as members pay for electricity from PEC — was in the best interests of the larger membership. 

“Dozens of studies throughout the U.S. conclude net metering provides more value to the utility than the customer with solar. That means that the customer with solar and the utility both benefit,” she said.

3 thoughts on “Members with solar homes to receive less from PEC for excess power

  1. The input from Public Citizen at the end of the article is misleading and factually incorrect. As clearly stated throughout the article, PEC is not abolishing net metering. PEC is simply changing the amount that is paid for excess generation in a month. Net metering is the offset of actual consumption for the month, which PEC will continue to do. What is not stated in the article is that all other members of PEC subsidize those with solar when the full retail rate is paid for excess. This change will partially remove that subsidization.

  2. Good article! Energy companies are already charging the public for the costs of last February’s Big Freeze that the companies were not prepared for. Now they want to make more money from solar customers. Unfair and greedy!

    1. PEC is a nonprofit. If they don’t collect the full cost of serving solar members, the rest of the membership effectively pays for the difference. There is a fair argument to be had about whether or not solar should be subsidized, but this is not about greed.

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