Quick Fact: Understanding the Change in Solar Rates

How will the new rate structure affect member generators?

  • The average solar producer will pay a little more to OPALCO each year, but there are many factors (such as size of array, household energy usage) and some might find they pay less.
  • Current solar producers can opt out of the new tariff (by June 30, 2022). Here is the form to remain on the legacy tariff:
  • Surplus energy produced will be a credit on their bill each month, instead of banking credits and getting a check each year. The surplus energy will be carried over in dollar amounts and show up as a credit on your power bill.
  • OPALCO will buy power from solar producers at $0.0849** per kWh when they produce more power than they use (retail rate is $0.1089**). Solar producers will continue buying power from OPALCO at the retail rate, just like the rest of the membership, when they don’t have enough generation to meet their need. This tariff will be adjusted each year with the same formula that affects the other tariffs.
  • Return on investment could shift for members starting new solar (or other renewable) projects, depending on size of array and their total energy usage.

OPALCO cares about building a healthy and sustainable energy future and is working hard to protect and improve the environment with our decarbonization efforts and advocacy in the region. Solar plays an important role in this future.

The change affects the rate that members who produce their own power are paid for the excess power that they sell back to the Co-op. Currently, solar producers (also called member generators*) are paid a retail rate ($0.109/kWh**) and the new rate proposed is $0.0849/kWh** – still almost double what OPALCO pays for wholesale power from the mainland.

OPALCO still encourages local renewable power – today more than ever as we face the challenges of decarbonization – but with the growing number of solar producers, the time has come to ask the people who generate their own power to pay their share of the costs to run the grid their systems depend on. The service access charge that all members pay covers less than half of the true cost to keep the grid running; the rest comes from energy usage (kWh) charges.

chart: fixed costs vs service access fees

Many solar producers pay only the service access charge and no energy charges during the months they produce the most power. This creates a revenue shortfall for the Co-op.

The new tariff (the combination of rates, additional charges and other rules that determine how your electricity bill is calculated) provides a way for solar producers to start paying a little more toward the cost of the grid that they use, and also includes a credit to recognize the environmental value that their systems bring to the co-op power supply.




Learn more:

* ‘member generators’ include co-op members who produce local renewable power connected to OPALCO’s grid using solar, wind and micro-hydro. The majority produce energy with solar; ‘solar producer’ is used interchangeably.

**2021 rates. There is a 4% increase on rates for 2022