Provo Power examines rooftop solar rates and potential customer changes

The Provo City Council Work Meeting held on January 14, 2025, focused on several key topics, primarily revolving around the financial implications of rooftop solar energy for local customers and the utility's revenue.

The meeting began with a discussion on the avoided cost calculation for energy generated from rooftop solar systems. This calculation is essential for understanding the savings associated with not having to build a new power plant. The analysis indicated that the avoided cost for generating equivalent energy from rooftop solar is approximately 4.8 cents per kilowatt-hour. This study, typically reserved for direct power plant purchases, is required by the Utah Public Service Commission for qualifying facilities.

Council members noted that the financial benefits for Provo Power from rooftop solar customers range between $75,000 and $100,000. While this figure is not substantial, it reflects a positive contribution to the utility's revenue. The average increase in customer bills due to these adjustments is projected to be between $5 and $8, with a return on investment (ROI) for solar customers exceeding $21,000, provided they size their systems correctly and avoid financing their panels.

The council also highlighted the growth of Provo Power's customer base, noting they are just 31 customers shy of reaching 40,000. This milestone has been a long-term goal for the utility, and plans are in place to celebrate the achievement with the new customer.

As the meeting progressed, various options for future rate adjustments were discussed. The council considered leaving the current rates unchanged, modifying rates for customers who installed systems after 2016, or potentially grandfathering existing customers to protect their ROI. These discussions reflect the council's commitment to balancing the interests of solar customers with those of other residential customers in Provo.

In conclusion, the meeting underscored the ongoing evolution of Provo's energy landscape, particularly in relation to solar energy, and the council's proactive approach to addressing customer concerns while ensuring fair and equitable utility practices. Further discussions and decisions on these matters are anticipated in upcoming meetings.