August 30, 2021

Community solar workshop touches on bill credits, customer eligibility

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A workshop on Friday allowed stakeholders to weigh in on various topics related to community solar, including bill credits, the statewide megawatt cap and low-income subscribers. The New Mexico Public Regulation Commission is tasked with drafting rules for the community solar program.  

This process was sparked by the passage of Senate Bill 84, the Community Solar Act, during this year’s Legislative session. The law gives the PRC until April 2022 to complete the rulemaking. While the law went into effect in June, community solar projects cannot be approved until the rules are adopted.

Related: PRC says community solar projects cannot be approved until rules are completed

“April of 2022 might seem like a long time from now, but really it’s right around the corner, so we need to ensure that we maintain a steady pace of progress, always inching towards consensus on some of these weighty issues,” Commissioner Joseph Maestas said. “But really I want you all to think about what a historic effort this is to make solar energy affordable, accessible and reliable, especially to those New Mexicans who are less fortunate and can’t afford rooftop solar.”

Solar bill credit

The workshop started with discussion of solar credits for customers, with the three investor-owned utilities that operate in the state—Public Service Company of New Mexico, El Paso Electric and Southwestern Public Service—providing details about their rates.

James Schichtl, EPE’s vice president of regulatory and government affairs, broke down how the utility handles credits for subscribers of a five megawatt array in Texas. Each subscriber contracts for a certain amount of electricity from the community solar array. The bill is first generated based on meter readings, like all customer bills. But later the credits—including the amount of energy the subscriber has contracted from the array—are deducted from the bill.

Statewide cap

The Community Solar Act caps the amount of community solar initially allowed to 200 megawatts, proportionately allocated among the investor-owned utilities. This statewide cap does not include Native American community solar programs or rural electric programs. An annual statewide program capacity will later be established by November 2024.

Christopher Dunn, an economist with the PRC utilities division, presented a variety of scenarios. For example, the 200 megawatts could be divided up among the utilities based on the number of residential customers, the total number of customers, the amount of residential kilowatt hour sales, the total kilowatt hour sales, the revenues or the renewable portfolio standards the utilities have achieved.

If the PRC chooses to divide the 200 megawatts up based on the renewable portfolio standards achieved, SPS would be given 95 megawatts, EPE would have 15 megawatts and PNM would be allocated 90 megawatts.

But if the PRC allocated it based on residential kilowatt hour sales, SPS would be given 45 megawatts, EPE would receive 30 megawatts and PNM would get 125 megawatts. And if it was allocated based on the number of residential customers, SPS would receive 30 megawatts, EPE would have 20 megawatts and PNM would get 145 megawatts.

Low-income subscribers

The Community Solar Act requires that 30 percent of the energy be dedicated to low-income customers or agencies that serve low-income populations.

But there are concerns about how subscribers will be determined to be low-income.

Jake Springer, who works for a developer of community solar projects, said there are a number of ways to determine if people are low-income, such as looking at census tracts or allowing customers to attest to their income level.

Springer said allowing customers to attest to their income level protects sensitive information like social security numbers.

Other options discussed included working with community organizations that serve low-income populations to connect with potential subscribers who could benefit from community solar and prequalification by participating in other programs designed to assist low-income individuals.

Next steps

Based on the information gathered during the workshops, which began in June, and the legislation the PRC will draft what a proposed rule could look like and a more formal rulemaking process will begin, according to Arthur O’Donnell with the PRC. O’Donnell moderated the Friday workshop. A report will also be compiled for the commission.

“At 200 megawatts, this would be the largest community solar program in the United States,” he said. “That’s a really important thing to remember. We have a very ambitious program ahead of us and a lot of things that have to get worked out.”