SANTA CLARA – The Santa Clara City Council put its solar feed-in tariff policy on hold Wednesday after residents complained and officials decided to take a closer look at the issue.
Currently, there are only about a dozen homes with solar panels in Santa Clara, but that number is increasing and city officials have been working to put a system in place that is fair to all city residents.
The city passed a feed-in policy for solar power installed by residents in July, but the policy has been frozen while the city reevaluates the policy.
Resident Sam Davis told the council he recently moved to Santa Clara and decided to put solar panels on his home because he is retired on a fixed income and was trying to reduce his monthly expenses.
“We had an ROI (return on investment) of about 15 years,” Davis said, meaning the system would pay for itself within 15 years.
Under the current policy, which has just been suspended, the ROI changed to about 20 years.
“We would not have installed it if that had been our ROI,” Davis said, and some of the other residents with solar power have expressed feeling the same way, he added.
Davis said he did not want to be subsidized by other homeowners in the city but just wanted a little bit of self-reliance and to reduce his monthly costs.
Public Works Director Jack Taylor said the city is doing an in-depth study on the electrical system to find out the costs and benefits associated with solar power. “And if there’s more benefits than what we figured, we want to give our residents a bigger chunk of that money back to them and make sure we’re doing it correctly.”
The study will look at several different ways having solar power feeding into the system will help the city power department avoid costs.
A third party, Utah Associated Municipal Power Systems, or UAMPS, will be doing the study, Taylor said. UAMPS is a nonprofit conglomeration of municipal utilities that serves 45 municipal power utilities, including Santa Clara, over several Western states.
The UAMPS study will look specifically at avoided costs for fuel, power plant maintenance and operations, generation and transmission capacity costs, reserve capacity and environmental costs, Taylor said.
“We’ll be able to put our numbers into that study, and it should be able to come up with a number that will hopefully be fair to our customers, that will be fair to the city and that will not push any costs over to customers that don’t have solar on their home,” Taylor said.
The city will likely stick with the feed-in tariff structure but may change the rate residents are paid for excess electricity that is pushed back into the power system.
Before July, residents were paid 8.5 cents for every kilowatt-hour their solar systems fed back into the city system. Under the policy passed in July, residents were paid 5 cents per kwh.
Although the price of electricity can vary widely, 8.5 cents per kwh is roughly the retail rate, while 5 cents per kwh is the wholesale price the city pays, Taylor said in a previous interview.
Taylor recommends that homeowners considering a solar installation be cautious to make sure they are getting a good price for the equipment.
“They, at least, should get three bids from different solar companies so that they know they are getting a fair price,” Taylor said, adding homeowners should also consider the length of time they plan to be in their homes.
This is especially important for older residents who may not be able to stay in their homes for 15 or 20 years, making the extended return on investment impractical.
“It may not always make financial sense,” Taylor said.
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