Utilities Want Solar Customers to Pay More

Their argument: The few (homes with solar power) are being subsidized by the many (everyone else).

 By CASSANDRA SWEET

"People with solar panels on their roofs often get a pretty good price break on their energy bills.

Too good, some utilities say.

Now, utilities in several states—including the country's sunniest, California and Arizona—are trying to do something about it.

Here's the issue: For most homes, solar panels don't generate all the power the residents use. At night and on cloudy days, and sometimes even on sunny days, these homes draw power from the grid that serves all a utility's customers. But at other times, the panels generate more power than the home is using, and that surplus power flows into the grid.

Under state rules known as net metering, customers are credited on their bills for any power that flows from their homes to the grid, usually at the same rate they pay when they draw power from the grid. 

So, customers with solar panels not only are buying less electricity from their utilities, but also are able to offset much of the cost of what they do buy.

The utilities say solar customers are paying so little that they don't cover their share of the cost of maintaining the grid, which they still rely on. That drives up costs for nonsolar customers, utilities say, and they warn that the burden will grow as the number of solar customers continues to swell.

Solar companies and their customers deny that people with solar panels aren't paying their share of utility costs, and argue that rooftop solar systems benefit utility grids by relieving demand and providing extra power. Cutting incentives would reduce the appeal of solar energy, they say, depriving the grid of some of that additional power, blunting the environmental benefits of solar power and hurting the young, fast-growing industry."

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 Ms. Sweet is a Wall Street Journal staff reporter in San Francisco. She can be reached at cassandra.sweet@wsj.com.

A version of this article appeared September 23, 2013, on page R3 in the U.S. edition of The Wall Street Journal, with the headline: Utilities Seek to Raise Bills for Solar Customers.