Setting the Record Straight

Xcel Energy continually strives for accuracy and proper context when presenting information to journalists on company activities and policies. Journalists also strive for accuracy, but on occasion a story may misrepresent or misinterpret Xcel Energy's role, activities or policies or contain inaccurate information.

Whether it happens through our error, or an oversight by a reporter, we will "set the record straight" in this section of our Internet newsroom - to let other journalists and our customers know our version of the story as we see it.

Solar Reward Response

A story that aired on a Denver television news broadcast on Friday, July 24, and in local newspapers may have left viewers with the wrong impression about a proposed minimum solar power connection charge that is part of Xcel Energy’s latest electric rate case. We wanted our customers to better understand the proposal.

Xcel Energy has filed with the Colorado Public Utilities Commission to recover the costs of our delivery system more equitably. The proposal calls for ONLY customers who install solar panels after April 1, 2010, to be affected, and even then, some customers will not pay the minimum electric grid connection charge because they are using enough energy to pay for the cost of their connection.

We believe that the Solar*Rewards program provides significant benefits to participating customers. Our minimum bill proposal is one option we have put forward to address inequities that can occur among our customers. We believe the proposal has started a healthy dialogue about the most reasonable way to accommodate increased solar energy on our system in a manner that is fair to all of our customers.

Currently, the majority of our Solar*Rewards customers, receive incentives paid for by all of our customers to place solar panels on their homes. However, these customers do not typically pay for their portion of the cost of access to the electric grid. Solar*Rewards customers benefit from that grid by having the company as both a back up to their solar power system and a place to sell their excess energy when they are not using it.

As a general rule, residential customers now pay for the connection to the electric grid as a part of their per kilowatt-hour charge for power. Solar power customers who use essentially the same amount of energy as they produce end up with a bill of $0, even though the fixed costs of the electric grid do not vary with the amount of energy they produce. Our proposal only attempts to reflect the portion of our costs related to the transmission and distribution system and only to the extent not covered through energy purchases. Customers installing their own distributed generation will not be responsible for any portion of our power costs unless they actually are a net user of energy from our system. The minimum bill proposal would treat Solar*Rewards participants in the same manner as other owners of distributed, on-site generation.

The projected additional costs come to about $1.90 a month for a customer that has a solar power system of about 4.5 kilowatts. A typical Solar*Rewards customer will avoid $33.53 a month in electric charges. The charge is not an add-on to the net metering bill. It is a minimum charge that is applied only if the net metering bill is not sufficient to cover the cost of access to the grid.

We think that this approach combined with our incentives for the Solar*Rewards program is a reasonable way of balancing cost responsibility for our electric system while continuing to lead the way in promoting renewable energy in Colorado. We welcome an open, factual discussion on this and other alternatives in our pending rate case, as we move forward with pricing options that begin to anticipate future changes on our system and the way in which our customers use energy.