North Carolina regulators approved Duke Energy’s (NYSE: DUK) rooftop solar plan on December 31, but told the utility that it could not recoup the entire cost of the plan from customers.
The North Carolina Utilities Commission said at the proposed cost of $50 million for 10 megawatts (MW) of solar power, Duke would be paid significantly more per kilowatt hour (KWh) than third party solar providers.
As proof, the commission pointed to a contract granted by Duke to SunEdison in 2007 to feed power into the grid at a much lower cost.
Duke wants to own and install solar installations on customer rooftops. The utility says the project will be an experiment to test find out what is the most cost effective method of adding solar power.
The utility has already cut in half the scope of the project at the urging of the Utilities Commission, which feared that it might create an uncompetitive environmnet for smaller solar developers.
The Commission said Duke could still recover the full $50 million from customer rates, if it proves the cost difference is truly research and development. Otherwise, it must find a different source of funding.
Southern California Edison is moving forward with a similar plan to install 250 MW of rooftop solar at a reported cost of $875 million.
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