Reported by Art Mass

Responding to a broad coalition of opposition, Xcel Energy today backed off on its proposal for essentially a “net-meter” tariff to solar customers — at least for now.

Xcel told regulators prior to a planned public hearing Wednesday evening that it was dropping the idea, a decision supported by Gov. Ritter.

Ritter said in a statement that he believed Xcel’s new minimum monthly bill, if implemented, would have been a disincentive for customers to buy solar panel arrays, stifling job growth, inhibiting future economic development and penalizing those voluntarily invested in clean energy.

The proposal was part of Xcel’s rate case filed with the Colorado Public Utilities Commission last May and would not have affected current solar-generating customers if implemented, only those businesses and homeowners installing solar panels after April 2010. Solar vendors in Xcel’s service area have been howling in protest ever since the state’s largest utility announced its intention. Even the Governor’s Energy Office (GEO) expressed disappointment at the plan.

“We made this proposal in good faith as a reasonable approach to provide for a fair allocation of costs and benefits between customers with solar panels and customers without solar panels,” said Karen Hyde, VP of rates and regulatory affairs for Xcel’s Colorado division, known as Public Service Co. of Colorado. “However, we appreciate that the proposed rate mechanism has caused significant customer confusion.”

Ritter said the GEO will analyze the costs and benefits of “distributed generation,” such as rooftop solar systems installed across a wide area, so that state regulators can use that information when deciding the costs and benefits of the rapidly growing sector.

Commented Beth Hart, Executive Director of the Colorado Solar Energy Industry Association, “I am very pleased that Xcel dropped the net meter charge from the rate case. I agree with Xcel’s recommendation that the issue be addressed through a roundtable workshop-type process. We are looking for what is fair and equitable, something all energy consumers can understand, something that will credit the conservationist and not create division.”