By Theresa Phillips
In January 2009, LMUD interconnected its first customer-owned solar array. At that time, the net-metering program was new, and it was unclear how much interest customers would have.
Fast forward to December 2019. More than 40 customer-owned solar arrays equal more than 1 megawatt of distributed generation— and the LMUD net-metering program had reached full capacity. Net-metering capacity is limited to 5% of LMUD’s total load. When this cap was met, the customer-generator program was enacted. The program allows customer-generators to interconnect to LMUD’ssystem and take advantage of the benefits of solar.
The difference between the net-metering program and the customer-generation program is this: Net-metering allows customers to bank excess generation and use it at a future date. Those on the customer-generation rate do not bank energy. Instead, they are trued-up monthly. That means the account is balanced, with the customer-generator receiving a bill credit of 4.5 cents per kilowatt-hour for energy they import onto the grid in excess of what they use.
According to the U.S. Environmental Protection Agency, distributed generation is defined as a variety of technologies that generate electricity at or near where it will be used. Distributed generation is not limited to solar; it can be wind, biomass, hydro, and battery storage.
For LMUD and its customers, distributed generation or customer generation has been solely solar. The customer solar arrays that are connected to LMUD’s system range from 1,600 kilowatts to 760,000 kilowatts. Just about every class of customer—from residential to large commercial—has invested in customer-generation.
As of February 2022, six customer-generation projects are in the queue, with more inquiries each day.
When a customer calls with a solar question, they often have received information from a contractor or solar salesperson. The information may not be specific to LMUD’s solar program and can be unintentionally misleading. As a publicly owned utility, LMUD has developed a program that makes sense for its customers. Because LMUD is not under the same rules and regulations as investor-owned utilities, installing customergeneration on LMUD’s system can be very different.
For example, investor-owned utilities have time-of-use or tiered rates. LMUD has a flat rate, meaning regardless of the time of day or the amount of energy used, the cost per kilowatt-hour does not change.
Solar salespeople may tell you your energy costs will increase 7% per year. This is based on national averages. LMUD’s residential rate is the same as it was in 2008.
All of this affects the rate of return on your solar investment, since the more you pay for electricity, the more your customer-generated energy is worth.
LMUD is owned by the customers and the community it serves. Therefore, every program implemented is done in the best interest of those served. The customer-generator program is an example of that. The program was built to be fair and equitable to all customers. Customer-generators pay the same facility charge as nongenerating customers, and are subject to the same rules and regulations as nongenerators.
Investing in a customer-generation array is a huge commitment. The cost and the benefits must be weighed carefully. LMUD is here to help guide you in that decision.
LMUD customers Jim and Marilyn Sue Chapman are the latest customers to go solar, installing an 8-kW array on the 110-year-old house they have lived in since 1981.
“We’ve wanted to install solar for a long time,” says Marilyn Sue. “Our motivation was to generate our own clean energy.”
When asked if money was a factor in their decision, both Jim and Marilyn Sue said “not really.”
“The cost of the system—around $21,000 after a $7,000 or so tax credit—is significant, but being able to be self-sufficient, that was our real motivation,” says Jim.
Jim explained that the ability to be their own power plant, so to speak, was intriguing.
“We use the energy we generate first, then, if we need anything else, LMUD provides that,” he explains.
For the Chapmans, the key to a successful installation was working with a reputable contractor and experienced installer. They also consulted with LMUD before they decided to go forward, getting all the facts and figures from a reliable source.
Just like the Chapmans, LMUD wants you to have all the information, and make sure it is specific to you, not to solar customers in other areas.
There are many advantages to being a customer of a community-owned utility such as LMUD. Expert guidance is one. If you are considering becoming a customer-generator— whether it is with a solar array or some other form of distributed generation— LMUD is here for you every step of the way. Energy experts can be reached at (530) 257-4174, Monday through Friday, 8:30 a.m. to 4:30 p.m.
You can also find a wealth of information at lmud.org. You’ll see the link to solar information on the home page. There, you can view solar requirements, LMUD’s interconnection agreement, and the distributed generation rate. Remember: Don’t sign on the dotted line until you have all the facts.