Duke Energy’s net energy metering agreement filed with N.C. Utilities Commission

Duke Energy on Nov. 29 petitioned the North Carolina Utilities Commission (NCUC) to approve its proposed net energy metering tariffs, a billing process that credits small customers with rooftop solar arrays for excess electricity they generate and provide to Duke Energy via the grid.

Duke Energy’s filing is a net energy metering agreement that the Charlotte, N.C.-based utility reached with the North Carolina Sustainable Energy Association, the Southern Environmental Law Center (SELC) — on behalf of Vote Solar and the Southern Alliance for Clean Energy — Sunrun Inc., and the Solar Energy Industries Association.

“Duke Energy is committed to finding collaborative paths forward to help with the clean-energy transition and carbon-reduction goals in the Carolinas,”  said Stephen De May, Duke Energy’s North Carolina president. “This deal ensures fair and reasonable treatment for all customers whether they choose to install solar or not.”

If approved by the NCUC, the agreement would allow for new net metering tariffs to go into effect for customers submitting applications on or after Jan. 1, 2023, and would create new pricing and incentives for residential solar customers, according to Duke Energy.

“The agreement modernizes rooftop solar economics and unlocks benefits for all customers,” said Lon Huber, Duke Energy’s vice president of strategic solutions. “Net metering has been a contentious issue around the nation, but our stakeholder partners worked together to craft a fair solution that brings financial sustainability to rooftop solar in North Carolina.”

Specifically, Duke’s filing features rate design mechanisms for collecting costs of the grid infrastructure needed to serve solar customers and includes innovative retail rates that vary based on the time of day and when the utility is experiencing peak demand, the Fortune 500 company said yesterday in a statement.

The agreement also establishes new price signals and opportunities for homeowners to incorporate innovative technologies with solar, including smart thermostats and battery storage, said Peter Ledford, general counsel and policy director at the North Carolina Sustainable Energy Association.

“This program pushes forward progress in North Carolina’s clean energy economy,” Ledford said. “Not only does it advance the residential solar sector, but it also provides a framework and agreement to work collaboratively on the next generation of nonresidential net metering.”

At the same time, said David Neal, senior attorney with SELC, the agreement recognizes the important role that solar can play in keeping the electric grid resilient and affordable. 

“If the full proposal is approved, customers could receive significant up-front savings when adopting solar paired with Duke Energy’s smart thermostat program,” Neal said. “In the case of solar panels that are leased, those savings could translate to lower costs over the lifetime of the lease, providing more affordable ways for customers to go solar.”

Bryan Jacob, solar program director at the Southern Alliance for Clean Energy, said the organization thinks it is important to provide a fair valuation of distributed energy resources. “Those customers who provide services to the grid with their private investments should be fairly compensated for those services,” he said. “At the same time, it is important that rates be designed to align customer behavior with controlling utility costs when possible.”

Duke Energy’s new agreement follows a similar net metering agreement the utility made in September 2020 in South Carolina with leading solar installers, environmental groups, and renewable energy advocates. The Solar Choice Net Metering plan includes retail rates that vary based on the time of day and when utilities experience peak demand and provides customers the ability to install a smart thermostat with their solar panels and receive an incentive for the combination.

Additionally, Duke Energy is expected to continue its three-year-old, $62-million solar rebate program into 2023. Currently, 24,000 North Carolina customers have private solar systems compared to 6,000 at the beginning of 2018, the company said.