With meters running backwards, utilities seek a niche.
William Atkinson is a Fortnightly contributor based in Carterville, Ill.
Solar project financing has long proven difficult—for homeowners especially, but also for governments and commercial and industrial (C&I) customers. Now, with third-party financing winning converts, utilities are seen as supportive, yet watchful.
Price is key on the residential side. If costs fall far enough for small-scale installations, and if financing becomes a no-brainer, homeowners could flood utility distribution systems with customer-owned solar, posing operational problems and threatening stranded costs, both for generation and T&D assets.
Ditto for government and C&I installations. And the bigger the installation, the bigger the threat. Utilities haven’t yet complained about solar in the way they once did with industrial cogeneration. Yet it’s still early. In time, third-party leasing and financing could remake the landscape just as off-balance-sheet project financing paved the way for independent power producers.