As developers who were awarded slots in New Mexico’s community solar program work to get agreements to hook their future solar arrays into the grid, some of them may find that the process to connect to the existing electrical grid is too expensive.
Kevin Cray, the mountain west senior director for the Coalition for Community Solar Access, told the interim Water and Natural Resources Committee that those costs, particularly to connect to the Public Service Company of New Mexico’s system, may cause some of the developers to back out.
Last month, the New Mexico Public Regulation Commission issued guidance to the investor-owned utilities regarding interconnection.
PRC Chief of Staff Cholla Khoury said the developers must pay for the upgrades needed to connect to the utility grid.
“So if it takes new transformers, they’re supposed to pay for new transformers,” she said.
Those costs on the PNM system for the upgrades needed for projects to connect to the grid range from $350,000 to $12 million, Khoury said.
“That’s the next hurdle that these projects have to figure out how to deal with,” she said. “How to safely interconnect to make sure that the power that they produce can get to the customers who are subscribing to their projects.
But that does not mean community solar will not be built. There are plenty of waitlisted projects that could move up to fill those slots.
“There is going to be an opportunity where we may see some churn with some projects coming up from the waitlist and having an opportunity to move through,” Cray said.
Community solar allows people who don’t have the ability to access rooftop solar, such as renters and people living in apartments, to receive solar power through a subscription.
Cray said the arrays tend to have 90 to 100 percent subscription rates.
The community solar program includes requirements that a certain percentage of subscribers be low-income households or organizations that support low-income households.
The arrays can also help with economies in rural areas, he said.
“Community solar and [distributed generation] in general helps diversify and grow rural as well as urban economies. But a lot of these projects are going to be in more rural parts of the state, providing new opportunities for them to participate in the energy transition and grow their economy,” he said. “It also is basically creating an entirely new industry in New Mexico that is creating in-demand jobs that will help keep you know the kids of New Mexico in New Mexico to work there. These are jobs a lot of people would potentially move states to work on and so growing this organic industry in New Mexico will allow opportunities for folks to find jobs in the state of New Mexico and not need to look elsewhere to do so. It does lead to increased property tax and permitting revenue from the local jurisdictions.”
Most of the community solar projects will come online in 2025, but Cray said some could come online next year.
The PRC must provide a report to the legislature about community solar by November 2024.
Khoury said the commission will begin to collect information from projects and utilities about the lessons learned in getting the program off the ground.
The PRC will also be able to reevaluate the current 200 megawatt program cap next year. That could allow for additional community solar projects to be built.
