Green Pricing Premium: Less than it Seems
I disagree with the idea that green-pricing programs with the lowest premiums prove the most popular with residential utility customers, as suggested by the article, "Green Pricing: The Bigger Picture" (Byrnes et al., August 1996, p. 18). And, to the extent that that notion comes from information presented about the SolarCurrents program at Detroit Edison (DE), which I manage, I offer some points in rebuttal.
First, the number of participants may prove misleading. SolarCurrents operates a limited pilot program, offering only 28.4 kilowatts (Kw) of solar-electric service capacity (see table in article, p. 20). Marketed in 100-watt units, this program can serve a maximum of 284 customers, but only if each customer buys the minimum allotment (em at an average monthly increase of $6.59. In our case, the program became fully subscribed with only 195 customers, because a significant number exceeded their minimum capacity allotments and purchased between 200 and 700 watts. While the article attributed the low number of participants to lack of interest, the number actually reflected the greater willingness of our customers to accept the premium price and buy more than a minimum quantity of service. Currently, 70 DE customers have signed contracts (for 9.5 Kw) awaiting the construction of our next solar electric generating plant; more than 500 others have requested contracts since April.