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Green Tariffs

Monitor the Green Tariff for Changes

As your participation in the green tariff program unfolds over the contract term, it is important to continue to monitor the green tariff and have a clear understanding of any changes to the implementation of the program. Some green tariff components to stay aware of include:

  • Cost structure
    • The cost structure in some green tariffs may allow for periodic updates or adjustments. For example, in Xcel Energy Colorado’s Renewable*Connect program a portion of the bill credit is based on an avoided energy cost. In 2019, the Renewable*Connect credit was reduced from $0.04077 per kWh to $0.037 per kWh; this adjustment was due to a reduction in the energy portion of the credit and was attributed to a decrease in forecasted natural gas prices.
    • Costs may change over time as new renewable energy resources are added to the program. For example, to supply its Green Direct program, Puget Sound Energy (PSE) acquired a wind and a solar resource in two distinct phases. When the second, lower-cost resource started generating, PSE modified the tariff rates to account for the blended cost of energy, thereby reducing prices for existing customers.
  • Performance of the renewable energy resource

    If a renewable energy project is delayed, or if its production is insufficient, many green tariff programs identify how the utility and customer will be impacted. For example, in Public Service Company of New Mexico’s Green Energy Rider, if a resource fails to deliver renewable energy or RECs, the utility will offset the costs to supply renewable energy and RECs from an alternative source with proceeds from damages, credit support, or other compensation from the supplier who failed to deliver. In contrast, other green tariffs place this replacement risk on the customer and the utility is not liable.

  • Changes in consumption

    It is important to monitor your own consumption to determine if any changes will impact your program participation or price.

  • Expansions of green tariff programs

    Some green tariff programs lift caps and/or add more renewable energy capacity, either of which may enable you to expand your participation. As previously noted, the first wind resource supplying PSE’s Green Direct program was fully subscribed in less than a year. Subsequently, PSE sourced a solar resource to expand the initial offer.

    Again, it is important to continue to frequently engage with your utility. Your utility can inform you of any upcoming changes to the program, walk you through how the changes will impact the city, and potentially help minimize any negative impacts. Consider setting expectations regarding how and when the utility should communicate any important changes to the city.

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