The energy utility for Texan capital, Austin, is trying to water down city council proposals to ramp up solar generation, according to a report in the Texas Tribune newspaper.
As part of the drive for solar, politicians also demanded the power generator replace a 600 MW ageing natural gas-fired power plant with solar by 2017.
But according to a report yesterday by the Tribune's Neena Sutija, the utility has come up with a counter-proposal of a 50% renewables target and the replacement of the gas-fired plant with a newer, more energy-efficient version, powered by the same fossil fuel, with the conflicting demands set to go to an independent review.
The utility is claiming the big strides it made in renewables have left it hamstrung financially, having signed long-term solar PPAs years ago when solar energy was much more expensive.
A victim of its own success
According to the report, Austin Energy says it needs to balance its costly solar obligations by generating power from cheaper conventional sources and selling at a profit to keep consumer bills affordable.
The city council seems unlikely to bend on the power station question, given it has stated an aim of zero-carbon generation by Austin Energy by 2030.
The utility is already under fire from residential solar system owners in the city for its ‘value of solar tariffs' (VOST) scheme, which forces rooftop owners to sell all energy generated to the utility and buy electricity at retail price.
Homeowners with solar rooftops say the increased revenue from being forced to sell their energy rather than consume it for free has an impact on their income tax bills and also casts doubt over whether they qualify for the 30% federal income tax credit (ITC) to help fund such installations.
As the U.S. Internal Revenue Service (IRS) prepares a ruling on the two points, homeowners are calling for the introduction of net metering, permitting them to consume their energy and earn credits off their bills for excess power fed into Austin Energy's grid.
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