Can you join the solar energy revolution if you don’t have your own sun-exposed roof? Can you dip in, without having to spend big bucks for a complete system?
The Fortis electric utility in south-central BC wants its customers to be able to say “yes” to both questions.
Fortis is proposing a Community Solar Pilot Project that is now before the BC Utilities Commission for approval. The physical part of the project is a 720 panel, 240 kilowatt solar PV generating facility at the Ellison substation in the north end of Kelowna, estimated to cost $961,000.
If approved, Fortis customers would be able to sign up for their program called “Virtual Solar” and pay a monthly fee to acquire (virtually, not physically) the energy output from one or more solar panels. This energy would be credited to their regular electricity bills, reducing the number of kWh for which they are charged.
Fortis estimates the unit energy cost of renting a solar panel at around $0.23/kWh. At first the monthly fee for a virtual solar panel would amount to a higher price per kWh than the regular rate. But that fee would stay the same in future years, while Fortis’s regular energy rate would continue to rise. Sooner or later, the participants in the program would be paying less for their solar power per kWh than the regular rates.
The rules would be fairly straightforward, and a participant could drop out at any time. The number of participants and the amount of solar power sold under the pilot program would be limited by the number of panels. A customer wouldn’t be allowed to sign up for more solar power than the amount of electricity they normally use. If a customer had more solar power in a billing period than they actually consumed, then the excess (in kWh) would be taken off their next bill. If a participating customer moved to different premises within the Fortis area, they could (virtually) take their virtual solar panel(s) with them.
Similar to Fortis’s Community Solar Pilot Project is the City of Nelson’s 60 kilowatt Community Solar Garden, which is expected to start up in June. An interesting difference is that Nelson’s project offers a share purchase concept, rather than rental of the solar panels. Both projects will provide valuable lessons in designing a collective purchase financial model supporting renewable energy developments. Other community solar projects are also being developed in other BC locations.
Concern will no doubt be raised as to whether Fortis should be developing solar energy at all. Fortis isn’t claiming it has an immediate need for the new energy, so the output from this project, albeit small, would displace lower-cost resources that Fortis is currently using.
Another concern may be that the project could end up being subsidized by non-participating customers. Solar enthusiasts may gladly pay the $0.23/kWh cost for solar energy. But if not enough people subscribe or subscribe right away, the costs that were not covered would likely be spread over non-participating ratepayers.
Of course, the power from a 240 kW solar facility is a tiny fraction of Fortis’s overall electrical load, so the distributed solar revolution is not upon us yet. But this pilot project will teach us something about the financial and legal frameworks that will be needed to make it happen.