Delays in the construction of Xcel Energy’s La Crosse area community solar garden have yielded unforeseen benefits for consumers: lower costs and higher output.
The utility is proposing a 10 percent cut to the cost of subscriptions to the voluntary solar gardens, which if approved by Wisconsin regulators would be granted retroactively to current subscribers.
In a letter filed Monday with the Wisconsin Public Service Commission, Xcel attributes the change to falling prices and advances in technology since 2015. when the PSC authorized construction of up to 3 megawatts of voluntary community solar projects.
The company initially planned to build 1-megawatt gardens in Eau Claire and La Crosse.
About 90 percent of the available subscriptions were sold, but the La Crosse project was plagued by delays. Xcel canceled its contract with the developer, Pristine Sun, in July and last month signed a deal with OneEnergy Renewables to build a garden near Cashton.
Subscribers began receiving credits in September from an Xcel solar garden in the Twin Cities, and Pristine Sun completed work on the Eau Claire site last month.
Because costs for the OneEnergy project are significantly lower than the original bids, Xcel has proposed cutting the price of subscriptions from $1,780 to $1,600 per megawatt for everyone in program, including those who may subscribe to a third garden being considered for northern Wisconsin.
The price of installed solar panels has fallen by about 28 percent since 2015 and is now about a quarter of the cost in 2010, according to the Solar Energy Industries Association.
A proposed tariff on imported panels is already putting upward pressure on component prices, SEIA says soft costs — such as labor and permitting — present an opportunity for additional savings.
“It’s been a phenomenal run here in cost decreases,” said Tyler Huebner, executive director of RENEW Wisconsin.
Xcel is currently reviewing bids for a third solar garden in northern Wisconsin. Deb Erwin, the company’s manager of regulatory policy, said if that project ends up being less expensive than planned the additional savings would be passed on to all subscribers.
About 90 percent of the available panels in the first two gardens have been sold and Erwin expects many subscribers will apply their refunds toward buying up the remaining shares, which are sold in $320 increments.
In addition to being cheaper, the Cashton solar garden will feature sun-tracking panels, which generate more electricity than traditional fixed panels. Xcel has also proposed to pool the production credits so that all Wisconsin subscribers benefit from the increased efficiency.
With that gained efficiency, Xcel estimates residential and small-farm customers can expect to recoup their investments in 14 to 17 years, about 2 to 3 years sooner than under the initial projections.
While RENEW Wisconsin argued for a higher payback rate, Huebner said Xcel is offering consumers a good deal.
The PSC approved the gardens with the stipulation that all costs and benefits are borne by subscribers so that overall rates are unaffected. Any of the utility’s 257,000 Wisconsin customers can buy a 25-year subscription to the gardens. In return, they receive at least 7.4 cents per kilowatt hour generated in the form of a bill credit.
Based on the company’s assumptions, a 1-kilowatt subscription would generate about 15 percent of the annual Wisconsin household use, resulting in a credit of about $103.
Customers can sign up through the company’s website, where they will also find a calculator to estimate individual returns.
Xcel has requested that the PSC approve the proposed changes by Nov. 24 so that refunds can be issued to subscribers.