Scott Zollinger was well on his way to building a new barn on his property in Marion County and putting enough solar panels on top of it to offset the cost of electricity for his familyâsÂ home.
The design plans were drafted. The first payment was made on the solar panels. Zollinger had even applied and been approved for about $30,000 in state and federal tax credits on the $59,000 solarÂ project.
Then he got a report from his utility, Portland General Electric, on the impact his project would have on the electricÂ grid.
The report was filled with technical terms, but it ultimately concluded that he couldnât connect his 24.8 kilowatts of solar power to PGEâs system until significant upgrades had been made to theÂ grid.
The report included a bill for the estimated cost of the upgrades:Â $539,038.
âMy first reaction was: Iâm not sure how this is my problem,â Zollinger said. âHow is this our problem? âŚ We canât just payÂ $500,000.â
Aaron Eddy with Earthlight Technologies, who was managing the solar project for Zollinger, said he understood some of the jargon in the technical report, but not all ofÂ it.Â
However, Zollinger was not his first customer in the Willamette ValleyÂ to run into thisÂ problem.Â
âSo, the first project I was thinking maybe itâs just this one area,â Eddy said. âAnd then we had two other customers, one in the Silverton area and one in the North Salem area, both run into the sameÂ problem.â
The problem, he surmised, was that large-scale solar farms in that area had taken up nearly all the capacity for solar power to be fed into that portion of theÂ grid.
The substations that control the distribution of power were designed to send power in one direction: from the power plant to peopleâs homes. They have limited capacity to allow power to flow in the opposite direction. And in some parts of the state, large solar farms have taken up most of thatÂ capacity.
âFrom our understanding, those contractors have sized their projects to reach that threshold but not exceed it so theyâre not required to pay for the substantial upgrades that are necessary for exceeding that set limit,â EddyÂ said.
And that means the next project that wants to sell power to the grid â even if itâs just a few rooftop solar panels on a barn â gets stuck with the bill for upgrading theÂ system.
PGE spokesman Steve Corson said that is indeed the situation, albeit in very few parts of the utilityâs territory so far. Customers who want to install solar panels that sell power to the grid need to use a system called ânet meteringâ to get credit for the power theyâreÂ generating.
âBy far, most net metering customers are not going to encounter this,â Corson said. âThis is something thatâs affecting a small number of projects at thisÂ point.â
Right now, PGE has more than 650 feeder lines that radiate out from substations to serve neighborhoods around the state. Only 11 of those lines have reached their capacity to receive solar power. Corson said theyâre mostly in the southern part of PGEâs territory, around Salem and Turner, where the utility has seen a lot of new commercial solarÂ developments.Â
Under current rules, Corson said, the costs of upgrading the grid often fall to whoever needs the upgrade to accommodate their project. PGE provides estimates of the costs and the capacity limitations to commercial solar developers during the application process. Some developers agree to pay for the upgrade costs required to install their projects, while others take a differentÂ approach.
âThey might reconfigure their system just to fit right within our capacity,â he said. âAnd the bad news for surrounding net metering customers is that once that project has used up the capacity on the system, then the next project that comes in ends up having to foot the bill for those improvements and thoseÂ upgrades.â
Corson stressed that the situation is rare. Since 2016, he said, PGE has had 5,737 net metering application, and 86% of them were approved without so much as an application fee. Only 42 of them, less than 1%, required any kind of system upgrade charges, and most were for transformer upgrades at a cost of $3,000 toÂ $5,000.
The substation upgrades required in Zollingerâs area are rare and clearly much moreÂ expensive.Â
Jordan Sinn, general manager for Earthlight Technologies, often handles customer interactions for the companyâs rooftop solar projects, many of which are in the Willamette Valley areas that now apparently have grid capacityÂ issues.
âThis is becoming a common thing,â he said. âWeâre in an awkward position where we donât know until we submit quite a bit of paperwork with PGE to find this out. Itâs been a bit of a black eye for the solarÂ industry.â
Zollingerâs upgrade costs were by far the highest heâs seen so far. For other customers, the cost of upgrades still would have doubled the cost of their solar projects, and they chose to walkÂ away.
âItâs almost humorous after they get over the shock of, âThis is real,ââ Sinn said. âThereâs really no conversation about whether they want to move forward. Itâs just kind of, âWell, can I get aÂ refund?ââ
Zollinger said he now looks at the other rooftop solar projects on his street a littleÂ differently.
âThere are two other solar projects that got there first but because they can only reach a certain capacity weâre just pushing it past the line,â he said. âAt the end of the day itâs really a bum deal for my wife and I who would love to doÂ this.â
Heâs still planning to build a new barn, and thereâs a chance he could revisit the idea of installing solar panels if a proposed commercial solar project nearby pays for the upgrades to the grid in the next fewÂ years.Â
âIt doesnât blow up our world,â Zollinger said. âIt just makes me frustrated. That is not how this should have went. At the end of the day it kind of feels like the big guy shoving us out of the room, and thatâs what itÂ is.â
Eddy said the big question is who should be paying for the upgrades that are needed to allow for more renewables to feed into theÂ grid.
âThe math doesnât lie. These upgrades need to happen based on what has been installed in these areas,â Eddy said. âI was surprised that there was no regulation in place to make sure it wasnât affecting average Oregonians and their ability to installÂ solar.â
Eddy said if the problem continues, he might have to downsize or move his Silverton-based business to another area.Â He said it seems like the state as a whole has been pushing for more solar and renewable energy, âbut we havenât figured out how to actually make the wires and the nuts and bolts work to doÂ that.â
Angela Crowley-Koch, executive director of the Oregon Solar Energy Industries Association, said grid capacity is a problem across the state â in both PacifiCorp and PGEÂ territories.
In some cases, the utilities should be making the upgrades themselves, she said, and most commercial solar projects do end up paying for the requiredÂ upgrades.
Meanwhile, sheâs helped people send their complaints to the Oregon Public Utility Commission, which has the power to change the rules for who pays for whatÂ upgrades.
âI think itâs still an open question,â Crowley-Koch said. âThereâs a lot of folks not getting solar that want it because of thisÂ issue.â