On March 1 st , 2022, Pedernales Electric Coop announced a change to its Solar Interconnection
Rate. The change was made after results of a board-commissioned study were published in
November 2021. The stated mission of A Review of the Value of Solar Study, performed by GDS
Associates and corroborated by the Perryman group, for Pedernales Electric Cooperative was to
“true up” the previous solar interconnection rate; to account for a “subsidy” that PEC claimed
solar owners were receiving at the expense of non-solar owners.

This subsidy is described in the report as follows: “The “Value of Solar Study” shows that a
member-owned solar system provides some decrease in costs for transmission access charges
during the summer, but solar systems do not reduce the direct costs incurred by PEC for
investment, operations, and maintenance of the distribution system.”

“With increasing use of distributed generation among customers, electricity providers must
determine the appropriate method and amount of compensation to provide these customers. The
compensation must be fair and equitable to all customers. In addition, it must cover associated
costs to make the programs economically feasible and sustainable.” – Perryman Group
Meters at solar-equipped services record Delivered power, Received power, and Net usage.
Previously, PEC billed solar owners for the Net kilowatt hour value. Bear in mind that a solar
system’s electrical production services the home first, with excess power traveling “up” the
meter and onto PEC’s lines. Essentially, PEC was buying each kilowatt hour received from the
member at the delivery rate.

“From a rate standpoint, the reduced energy purchases of a member with [Distributed
Generation] will be treated the same for equity purposes as if a homeowner installed energy
efficiency measures to reduce energy consumption.” -Value of Solar Study, 2021
A kilowatt sent back to PEC’s lines is credited on the member’s bill at a rate of $.055377 per
kilowatt hour. Essentially, members will pay for every kilowatt delivered at the normal rate, but
see a line-item credit on their bill for about 5.5 cents per kilowatt hour sent to PEC’s electrical

For members considering going solar, this will affect their ability to accurately calculate
financial payback models, as a produced kilowatt hour may be worth about 5.5 cents or about
twice that if consumed. One strategy might be to orient arrays westward, to closely match power
demand curves. Calculating solar production is easy, matching consumption in real time can be

Value of Solar Study: https://www.pec.coop/wp-content/uploads/2021/11/Interconnected-
Perryman Group Review https://www.pec.coop/wp-content/uploads/2021/11/Interconnected-
PEC Interconnection Rates https://www.pec.coop/your-service/distributed-