Portland General Electric (PGE) is proposing changes to net metering policies in Oregon, which would impact homeowners with solar panel systems. The proposed changes include reducing the credit homeowners receive for excess solar power they feed back into the utility grid.
This reduction in solar net metering credits would mean that homeowners with solar panels would receive less compensation for the electricity they generate. The reduction in solar net metering credits would also extend the payback period of solar panel systems.
What are PGE’s plans to reduce net metering? How would it affect your solar panel system? And is there a way around these net metering reductions? We’ll dive into those questions in this article.
Quick Breakdown
- Net metering provides energy credits to solar homeowners who produce more energy than they use. These energy credits can be used towards future energy consumption.
- PGE plans to reduce the value of net metering energy credits by 20% to 30%, but no proposal has been finalized or presented to Public Utility Commission (PUC).
- Potential exceptions for solar panel systems installed before policy change, systems installed with batteries, and low-income households who install solar panels.
- A reduction in net metering energy credits would lengthen the payback period of solar panels, taking longer to break even on investment in solar.
- Installing solar now and/or with batteries could lock in 100% net metering benefits.
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What is Net Metering?
Net metering is a billing arrangement that allows homeowners with solar panels or other renewable energy systems to receive energy credits for the excess electricity they generate and feed back into the grid. These energy credits can then be used towards future energy consumption.
As of now, Oregon utilities (including PGE) provide a 1:1 net metering energy credit. This means for every kilowatt-hour (kWh) a solar homeowner provides to the utility grid, they get 1 kWh energy credit.
In most cases, solar homeowners produce excess energy (and earn energy credits) in spring and summer when the sun is most intense. They can then use those energy credits in fall and winter when the sun is less intense and power needs may be higher.
Net metering is a huge benefit to owners of solar panel systems. It allows them to balance their energy usage and production to get the most out of their solar panels and reduce or eliminate their energy bills.
Read more about net metering and learn how it saved solar homeowners money.
PGE’s Plan to Reduce Solar Net Metering
PGE is proposing changes to its net metering policies that would significantly reduce the value of energy credits homeowners receive for surplus solar energy. While PGE hasn’t released a finalized proposal, details have emerged about PGE’s potential plans to reduce net metering in Oregon.
As reported by The Portland Business Journal, PGE plans to reduce net metering by 20% to 30%. This would mean that for every 1 kWh a solar homeowner feeds back onto the utility grid, they would receive 0.8 to 0.7 kWh in net metering credits.
PGE argues that these changes are necessary to address cost concerns and ensure fairness for all customers. However, critics argue that reducing net metering benefits could slow down the adoption of solar energy and hinder progress toward renewable energy goals in Oregon.
Exceptions to PGE Net Metering Reduction Plan
PGE has mentioned a few potential exceptions to its net metering reduction plans. The first is a 10-year grandfather period for solar panel systems installed before the policy change. Since the average solar panel system in Oregon has a 10-15 year payback period (according to the Energy Trust of Oregon and EnergySage), the policy change might have minimal impacts on those households who install solar before the reduction in net metering.
Both low-income households who install solar panels and solar panel systems installed with batteries could potentially qualify for the full net metering benefits under PGE’s plan. However, solar panel systems installed with batteries would be required to participate in PGE’s Smart Battery program, where PGE can pull energy from a homeowner’s battery system at times of peak demand.
Learn more about battery backup, how it can keep you and your family safe, and charge your EV.
Impacts on Current and Future Solar Homeowners
PGE’s plans to reduce solar net metering would likely have little to no impact on current solar homeowners. But for homeowners who are thinking of installing solar panels, PGE’s plans could be a huge hurdle.
If PGE reduces the value of net metering energy credits 20% to 30%, it would mean a longer payback period for solar homeowners. A longer time to break even and see savings from solar would make solar less attractive to homeowners. It would also prevent homeowners from realizing the potential savings of solar energy and continue their reliance on the utility for power.
Install Solar Panels before PGE Reduces Net Metering
The best way to avoid PGE’s reduction in net metering incentives is to install solar panels before any policy changes take effect. By installing solar panels soon, homeowners can lock in their net metering at 100% for at least 10 years (if PGE’s net metering plans stand up). This means a quicker solar payback and greater long-term solar savings.
Another option is to install battery backup with your solar panel system. As PGE’s plans indicate, solar panel systems installed with batteries could receive full net metering benefits despite reductions for other households. The only stipulation is that PGE would have access to pull energy from your batteries during peak hours if necessary.
Contact Green Ridge Solar today to learn more about solar panels and battery backup. We provide a free solar analysis to see how much you could save with solar and answer all your solar questions.
And use our Solar Calculator to estimate your solar savings.
Estimate your total savings, payments, and total energy usage with our FREE solar calculator.
