The rapidly transforming energy sector presents a host of opportunities, such as increased resilience, cleaner energy technologies, a more efficient and reliable energy system, as well as greater flexibility, choice and control for consumers. One of the newer sector technologies driving this transformation is distributed generation, with distributed solar energy leading the way.
States have played a significant role in this energy revolution by creating policies, incentives and regulations that have transformed the solar and power markets. These efforts have been motivated by a range of factors, including economic development, job creation, improved air quality, sustainability goals, economic development, energy diversification and resilience to name a few.
Generating power on-site and close to where it is consumed has evolved over the past 20 years, requiring states to explore new regulatory and policy approaches. Most states’ electricity regulatory frameworks were designed with large centrally owned and operated power stations in mind. Adapting the grid and its supporting policies to accommodate consumers’ decisions to generate and use their own power, while sending some power onto the distribution grid, may require significant changes in regulatory and operational approaches.
The technical challenges of integrating consumer-produced power are being overcome by most utilities. Policy and operational approaches, however, can lessen the challenge, lower costs and increase reliability as distributed power gains market share.
This handbook is designed for state legislators, legislative staff, energy officials and others who want to learn about and assess their state’s distributed solar photovoltaic policies. It provides them with the tools to investigate options and practices to leverage the economic and reliability benefits of solar energy while addressing the challenges presented by this localized approach to energy generation. This document covers the many options and innovative approaches that states have implemented or considered when it comes to rate design, incentives, integration, financing, regulation and workforce development. While extensive, this report is by no means comprehensive, and provides readers with several references and resources for a deeper exploration of the topics covered.
This document will assist policymakers and planners that wish to tailor their state’s energy policy to best leverage the opportunities offered by the burgeoning of distributed solar energy.