Distributed Energy Resources in Nevada:

Quantifying the net benefits of distributed energy resources

Background
The enclosed white paper quantifies the net benefit of rooftop solar and other distributed energy technologies in Nevada,
specifically quantifying the costs and benefits identified by the Public Utilities Commission of Nevada in its 2015 Net Energy
Metering (NEM) Order. The analysis concludes rooftop solar delivers $7-14M million in net benefits to all Nevadans every
year at currently deployed levels. Increasing the deployment of rooftop solar over the next three years under NEM could
generate an additional $14-30 million in net benefits per year for all Nevadans, while cementing Nevadas position as a leader
in the transition to a clean, resilient, and affordable electric grid.

Key Finding: All Nevadans Benefit from NEM Rooftop Solar and Distributed Resources

Nevadas roughly 23,000 existing rooftop solar customers provide $7-14 million in benefits to all Nevadans, based on
the 11 cost and benefit categories proposed by the Public Utilities Commission of Nevada in their 2015 NEM Order.

An electric grid that embraces rooftop solar and smart inverters would deliver net benefits of between $14-30
million for all utility customers in Nevada, whether or not they own rooftop solar and distributed resources.
o When accounting for the full 11 cost and benefit categories identified by the Public Utilities Commission of
Nevada, rooftop solar deployed over the next three years (2017-2019) under NEM would drive net benefits
for all Nevadans of between 1.6 and 3.4 cents per kWh of solar produced.

The white paper finds that these benefits are created as electricity is transported from solar rooftops out into local
communities. Generating energy through rooftop solar saves all consumers money by reducing:
o The amount of energy that the electric utility needs to produce or purchase
o The need for new power plants
o The emissions from fossil fuel plants that lead to health and regulatory costs
o The need for utility equipment like substations and power lines

In addition to delivering net economic benefits to all Nevadans, rooftop solar improves flexibility in grid planning and
operations, enables customer choice, and accelerates the de-carbonization of our electricity supply.

Recommendations
Our ultimate goal in performing and disseminating this analysis is to provide a perspective useful for legislators, regulators,
utilities, DER providers, and industry stakeholders to consider as we transition to a cleaner, more affordable and resilient
grid. To that end, we offer the following recommendations:

Regulatory proceedings should consider the expanded benefit and cost categories identified in this paper.
Utilities should be required to leverage distributed energy resources during transmission and distribution planning.
Integrated resource planning should include distributed energy resources, such as distributed solar, batteries, smart
inverters and controllable loads.

These policies would deliver benefits to all Nevadans, whether or not they own solar. To read the full report, go to
www.solarcity.com/gridx and select the link for Distributed Energy Resources in Nevada.

Annual Net Benefits of 2017-2019 NEM Rooftop Solar Deployments

$0.12

2015 Levelized $ / kWh

$0.10
$0.08
$0.06
$0.04

$0.034
$0.016

$0.02
$0.00

Benefits

Costs

Net Benefits
(Excl. Environmental)

Environmental
Externalities

Net Benefits
+ Environmental

Annual Net Benefits of 2017-2019 NEM Rooftop Solar Deployments

Type

Benefit and Cost Category

Net Benefits
(Excl. Environmental)

Net Benefits
+ Environmental

2015 Levelized cents/kWh

Benefits

Costs

Energy

3.7

Same

Line Losses

0.4

Same

Generation Capacity

2.6

Same

Ancillary Services

0.1

Same

Transmission & Distribution Capacity

2.8

Same

CO2 Regulatory Price

0.9

Same

Voltage Support

0.9

Same

Criteria Pollutants

Not included

0.1*

Environmental Externalities

Not included

1.7*

Total Benefits

11.4

13.2

Program Costs

0.1

Same

Integration Costs

0.2

Same

Participant Bill Savings

9.5

Same

Total Costs
Total Net Benefits

9.8

9.8

1.6 cents/kWh

3.4 cents/kWh

*More recent academic studies estimate the criteria pollutants cost to be up to 5 cents/kWh and the social
cost of carbon to be as high as 12 cents/kWh in Nevada.