In 2011, Southwestern Public Service Company (SPS) saddled rooftop solar customers with a “standby charge” for backing up customers’ distributed generation systems. The charge, known as Rate 59, translated to about $13 (growing to $37 over the subsequent 5 years) for the average household’s solar project each month. It worked like a charm: rooftop solar never took hold, and while New Mexico has the second best solar resources in the nation, there are just 155 solar customers in SPS territory.
Now, in a potential reversal of seven years of unjust rooftop solar charges, Hearing Examiner Caroline Glick’s single line synopsis of her analysis of SPS’s charges sums up nicely the position we’ve held for years: Rate No. 59 is flawed in several respects and should be cancelled.
Vote Solar had intervened in two prior cases to eliminate the surcharge, but the first settled and the second was dismissed for unrelated reasons. This year we finally saw our day in court, thanks in part to New Mexico Vote Solar member Chris Dizon, who owns a small solar business and who testified as an expert witness on our behalf to talk about the effects of the surcharge on the market and on real people.
Vote Solar’s case was largely based on SPS’s improper interpretations of both law and rules. We challenged the costs being recovered, the method of recovering those costs, the legitimacy of the rate as a standby charge, and the lack of any substantive analysis and inclusion of the benefits of distributed generation. We also pointed out that the charge acts as a barrier to low-income customers and imposes a general chilling effect on the market.
The Coalition for Clean Affordable Energy and the City of Albuquerque took positions in alignment with ours.
The Hearing Examiner’s very thorough review and analysis of the legal and technical arguments in her recommended decision led to her conclusions that
- The standby rate is not cost-based;
- The SPS study is “riddled with errors” and unreliable;
- SPS did not calculate the benefits of distributed generation to the SPS system; and
- The rate collects costs not limited to the cost of providing ancillary and standby services (as required by statute).
The full Commission is likely to take up this recommended decision including this issue later this month. We encourage the Commission to take the time necessary to understand Hearing Examiner Glick’s recommended decision.