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Clarification on changes to Net Metering program
The District has implemented changes to its Net Metering program that will go into effect on February 1, 2018. Since the change was announced there have been misconceptions circulating that have unfortunately caused concern so we wish to clarify what is changing and the reasoning behind the change.
What is changing? First, Clallam County PUD has not ended net metering. We only changed a compensation component to our policy in how net metering customers are credited for excess energy sold back to the utility.
Beginning February 1, 2018, all new net metering applications will fall under new guidelines. For those customers who apply for and install PV systems on or after 2/1/18 they will be billed for all energy delivered by the utility at our retail rate. This rate is currently set at $0.0697 per kWh plus applicable taxes. The energy that you generate in excess back to the grid will be compensated at the District’s effective wholesale rate. This rate will be based on the prior year’s wholesale power costs by the District. For 2018 this rate will be set at $0.0385.
Prior to this change the utility was following RCW 80.60 which mandates the District offer net metering to eligible customers-generators on a first-come, first-served basis until the cumulative generating capacity of net metering systems equals 0.5 percent of the utility’s peak demand during 1996. The compensation for these customers was on a kWh for kWh basis, meaning that the utility was crediting power back at the retail rate. For specific language regarding compensation please review RCW 80.60.30. In 2014 Clallam County PUD met the requirements as stipulated under RCW 80.60. In fact, we currently have about two times the connected capacity as mandated.
Why the change? The main reason is that the premium being paid (difference between retail and wholesale compensation) to net metering customers is solely being funded by rate payer funds. Crediting net metering customers at the District’s retail price is much higher than what the District could reasonably obtain in the wholesale power market, and this primarily affects non-solar rate payers. The District has a fiduciary responsibility for all rate payer funds and subsidizing higher compensation to net metering customers is a direct deviation from that responsibility. We believe the new structure of compensation at the Districts wholesale cost is fair and reasonable when taking into account all rate payers.
If you have questions regarding this change, please do not hesitate to contact us.