Solar energy and utility regulation

Abstract

While it is fair to conclude that the commercialization of solar energy is inevitable, it is not always recognized that the national and world demand for energy will be of such magnitude in the future that solar must be fostered along with and not in lieu of other alternatives. The pressing issue is how to accelerate solar energy commercialization within the framework of a free enterprise system. Although product subsidy is an acceptable stimulus, solar must eventually compete for the consumer's dollar on a nonsubsidized basis. Solar commercialization will become a reality when this occurs. The regulatory aspects of solar, now beginning to emerge, are complex and often controversial. They must deal with consumer attitudes, sometimes inconsistent with business logic, the achievement of national energy goals, changing societal values, and equity in regulation. Specifically, the regulatory issues to be resolved in future years are the extent of utility involvement in solar, the fair-trade implications related thereto, and the rate criteria for auxiliary utility service. Solar/utility regulation in the foreseeable future will most often be reactive rather than proactive to legislative and utility initiatives. Regulatory decisions will be governed, for the most part, by equity and the law, not by resource stimulation.