By Steve Terrell
The state Public Regulation Commission is considering wiping out fees that Eastern New Mexico’s primary electrical power provider charges owners of rooftop solar energy systems.
A hearing officer recently recommended that regulators make Southwestern Public Service Co. stop collecting a “standby fee” from customers with solar systems, saying a study the utility used to justify the fees is “riddled with errors and unreliable.”
While the company is seeking an 11.6 percent increase in the fee, intervenors in the rate case say the fee — which currently averages about $28 a month — has had the effect of strangling the solar industry in Eastern New Mexico.
If the commission doesn’t abolish the fees, clean-energy advocacy groups say, other utilities such as Public Service Company of New Mexico and El Paso Electric might move to impose such surcharges on their own solar customers.
Asked whether PNM will seek similar fees if the commission allows the Southwestern Public Service fees to stand, spokesman Ray Sandoval said the utility doesn’t have a comment “at this time.”
Southwestern Public Service, a subsidiary of Xcel Energy, says in documents filed with the commission the fees are necessary because the company must maintain standby capacity to serve solar customers any time their sun-powered systems don’t generate enough energy. The company argues that all parts of its system are necessary to maintain reliability.
The company contends that prohibiting the fees, which have been in effect since 2010, would mean other customers who pay to maintain the utility’s system would in effect be subsiding those with solar systems.
But hearing officer Carolyn Glick wrote that the company failed to demonstrate the surcharge “appropriately recovers the costs of ancillary and standby services” used by solar customers or that the fees are “based in any actual difference in costs the company incurs to serve [solar] customers.”
Glick wrote that Southwestern Public Service can’t show it “provides distinct ‘standby service’ for [solar] customers that it does not already provide to all full-requirements customers.” She also said the utility can’t show that solar customers “are not already paying their proportionate share of system costs.”
She also said the company “failed to adequately consider the benefits [solar power] adds to its system.”
Megan O’Reilly, a Taos lawyer representing the Coalition for Clean Affordable Energy — which, along with a group called Vote Solar, intervened in the rate case — said the “standby fee” has had the effect of stunting the growth of solar energy in the part of the state covered by the company.
There are only 110 solar customers, she said. That’s a mere fraction of PNM’s 12,379 solar-powered customers (11,820 residential and 559 commercial) and the 2,766 interconnected solar systems in El Paso Electric’s New Mexico service territory as of last year.
O’Reilly said that since the commission allowed Southwestern Public Service to impose the fee, there have been repeated efforts to abolish it. “This is the closest we’ve come,” she said.
The commission is expected to vote on the issue in September.
