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Do residential net metering customers pay their fair share of electricity costs? Evidence from New Mexico utilities

Larry Blank and Doug Gegax

Utilities Policy, 2019, vol. 61, issue C

Abstract: We find that 67% of New Mexico's residential net-metering (NEM) customers are net buyers of monthly utility energy and, through these energy purchases from the utility, these customers cover 90% of their full cost of service. For those NEM customers that are net-sellers of “excess energy,” their only contribution to utility costs is through a small monthly fixed customer charge. Because NEM residential customers with “excess energy” comprise only 33%, of total NEM residential customers, NEM residential customer coverage of utility fixed costs, including both the net buyers and net sellers, is 65% of the full cost of electricity service.

Keywords: Net metering; Distributed generation; Fixed cost recovery (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:61:y:2019:i:c:s0957178719303261

DOI: 10.1016/j.jup.2019.100973

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