FAQs - Utah net metering and solar incentives
Thinking of going solar in Utah? Here’s an up-to-date summary of the most important net metering policies, rebates, and other facts you need to know.
Is net metering available in Utah?
Net metering is available with some utilities in Utah. Rocky Mountain Power, the largest utility in the state, is currently transitioning away from net metering and offers net billing to new customers.
Municipal utilities in Utah offer a combination of net metering, net billing, and feed-in tariffs. We list this policies in detail below.
Net metering with Rocky Mountain Power
In September 2017, Rocky Mountain Power came to an agreement with solar advocates and state agencies to end net metering for new customers and adopt a net billing scheme that is still relatively favorable to solar customers in the state.
Under this agreement, new customers will sign up for a net billing agreement that pays 9.2 cents per kilowatt hour of solar power that they export to the grid. There is also a one-time application review fee of $60, and an electric meter fee of $200.
Given that the current residential rate starts at 8.8498 cents per kilowatt hour and hits 14.4508 cents per kilowatt hour only if you use more than one megawatt hour of electricity during the summer months, this net billing agreement is a fairly reasonable deal for solar consumers.
If you sign up under this agreement, it will be in effect for you until December 31, 2032. The rate structure may be changed only with the approval of the Utah Public Service Commission.
These terms are part of a transition agreement that will be in effect until the aggregte amount of net metering on the grid reaches 170 megawatts, which should happen sometime in 2020.
After the transition period ends, a finalized rate structure will be in place for new customers. That rate structure has not yet been determined.
None of this affects existing net metering customers. If you connected your system before the transition period, you will continue to have net metering and be grandfathered until December 31, 2035.
Net metering with other Utah electric utilities
Most municipal utilities in Utah offer net metering to their customers, while others offer net billing, and some levy a fixed monthly charge. The list below summarizes the policies for Utah’s municipal utilities:
Bountiful has a feed-in tariff. A feed-in tariff means that your house doesn’t use any of the solar electricity you produce, but instead you are required to sell your electricity into the grid at the following rates:
- 12 am to 12 pm: 4 cents/kWh
- 12 pm to 4 pm: 6 cents/kWh
- 4 pm to 12 am: 9.25 cents/kWh
A feed-in tariff is even worse for solar customers than net billing because you never use your solar electricity directly. Changing the time of day that you use electricity doesn’t help either, because all your generated power is exported.
The current price of residential electricity in Boutiful is 9.25 cents/kWh, so the only time you are getting full value for the electricity you export is after 4 pm. Unfortunately, solar electricity generation tends to tail off around that time.
If you’re thinking of going solar in Boutiful, you should try to face your solar panels west to maximize your evening power generation.
Heber Light and Power
Heber Light & Power offers net metering. The maximum system size allowed is 15 kW or 90% of your annual usage averaged over two years - whichever is smaller.
More details: https://www.heberpower.com/net_meter.php
Kaysville City offers net metering to customers. Any power generation in excess of 100% of your usage in a calendar year is not compensated.
More details: https://www.kaysvillecity.com/696/Net-Metering-Documents
Lehi City offers net metering for residential systems up to 10 kW in size.
If you wish to install a system larger than 10 kW, you must instead interconnect your system under a feed-in tariff agreement.
A feed-in tariff means that your house doesn’t use any of the solar electricity you produce, but instead you are required to sell all your electricity into the grid. One meter tracks the electricity you use from the grid, and a second meter tracks the electricity you sell.
Under the feed-in tariff, Lehi City buys your electricity at a flat rate of 4 cents per kWh, which is less than half the residential retail rate of 8.761 cents per kWh.
Because of this unfavorable rate, if you’re a Lehi City customer, you should be sure to install a solar system no larger than 10 kW so you can take advantage of net metering.
Under Lehi City’s net metering agreement, your account is reconciled each year in March, and any excess credits you have are zeroed out. In other words, no credits are paid for any excess annual generation.
Logan City Light & Power offers net metering to its customers. Credits for excess power generation are carried over month-to-month and zeroed out once a year. In other words, Logan Light & Power doesn’t pay anything for annual excess generation.
- Net Metering Application Fee: $150
Murray City offers net metering to its customers. The maximum system size is 10 kW. Credits for excess power generation are carried over month-to-month and zeroed out once year. In other words, Murray City doesn’t pay anything for annual excess generation.
More details: https://www.murray.utah.gov/77/Net-Metering-Program
Payson offers net billing to its customers. The maximum system size for residential customers is 10 kW, and 25 kW for commercial customers. Payson City will buy your solar electricity according to the following rates:
- First 400 kWh: $0.0700/kWh
- Next 400 kWh: $0.08400/kWh
- All Additional kWh: $0.08900/kWh
More details: https://paysonutah.org/departments/public-works/power
Provo offers net billing to new customers for systems up to 25 kW.
Be aware that the City of Provo website refers to its solar interconnection as net metering, but it’s not. By definition, net metering is when you are compensated at the retail rate for electricity you send into the grid, as long as don’t generate more than 100% of your annual usage.
Provo doesn’t compensate you 100% for electricity you send into the grid, but instead currently pays 6.742 cents per kWh. The cost of electricity currently starts at 8.37 cents/kWh, so you are being compensated less than what you pay for grid electricity.
More details: http://provopower.org/net-metering/
Salem offers net metering to its customers. The maximum system size is 25 kW.
However, net metering customers must pay a fixed monthly charge according to the system size. The charge is $3.10 per kW, so a customer with a 6 kW system would pay a fixed monthly charge of $18.60.
More details: http://www.salemcity.org/building-department.htm
Santa Clara City
Santa Clara offers net metering to its customers. If you generate more electricity than you use in any month, the excess electricity is compensated at the Renewable Power Rate, which is currently 6 cents/kWh. This monthly reconciliation differs from many other programs, which reconcile over-generation payments annually. This can be a disadvantage in the spring, when solar generation is high but electricity usage from air conditioning is relatively low.
Santa Clara also levies a fixed monthly “solar reliability charge” according to your system size. The charge is $4.05 per kW. A typical system system is 6 kW, which would result in a fixed monthly fee of $24.30.
More details: https://sccity.org/solar/
Springville offers net billing to its customers. Any excess solar electricity that Springville customers export to the grid is compensated at a rate of 4 cents/kWh.
One important note is that if you generate more electricity than you use in any given billing cycle, you won’t receive any compensation for that electricity. This could be an issue in the spring when electricity generation is high but air conditioning use is still relatively low.
St. George City
St. George offers net metering to its customers.Any credits for over-production are reconciled annually and paid to the customer at the Renewable Wholesale Rate, which is currently 4.019 cents per kWh.
In addition, St. George levies a monthly Solar Reliability Charge (SRC) according to how much solar electricity you generate. This is based on the absolute amount of solar electricity generated in a month, not the net billed amount of electricity.
There is no SRC charge for the first 215 kWh generated in a month. After that, the fee is 2.328 cents per kWh.
- One-time application review fee of $245
- One-time bi-directional meter fee upgrade of $315
Washington City offers net metering to its customers. Electricity generation that exceeds a customer’s usage in a billing period is paid at a rate of 4 cents per kWh.
What solar incentives are available in Utah?
The Utah State Tax Commission offers a tax credit for renewable energy systems, including solar. The credit amounts to 25% of the total system costs, up to a maximum of $1,600.
This credit will step down over time and eventually drop to zero for systems that are installed after January 1, 2024.
This is a tax credit, so you claim this with your state income taxes. If your tax liability is less than the credit you’ve earned, you can carry forward any unused credits for a maximum of four years.
The relevant tax code is Chapter 10, Part 10, Section 1014.
Utah Sales and property tax exemptions
Unfortunately, Utah does not have any sales tax or property tax exemptions for residential solar photovoltaic systems.
Does Utah have a solar access law that addresses homeowners associations?
Yes. Senate Bill 154 provides the following protections for solar homeowners:
- for real property governed by a community association, a governing document may not prohibit or restrict an owner's installation of a solar energy system under certain circumstances;
- provides that a declaration may prohibit or restrict the size, location, or manner of placement of a solar energy system under certain circumstances;
- provides that an association may, by association rule restrict an owner's installation of a solar energy system under certain circumstances;
- provides for attorney fees in an action brought under an enacted part; and
- provides an applicability date.
You can read the full text of S.B. 154 for more details.
Is virtual/aggregate net metering (community solar) available in Florida?
Yes, projects up to 170 MW are allowed for projects aimed at residential consumers.
How much does electricity cost in Utah?
The average price of residential electricity in Utah state, over the past ten years, is 9.82 cents per Kilowatt hour. This is 19% less than than the US average price of 12.07 cents per kWh.
Why is this important to know? Depending on the size of your systems, owning home solar reduces or eliminates the effect of electricity price increases.
Historical Utah electricity prices (cents per kilowatt hour)
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