Idaho Solar Owners Blindsided: 60% Rate Cut Threatens Clean Energy Investment

Idaho solar owners are facing a major financial setback as Idaho Power proposes to slash their compensation rates to less than 1 cent per kilowatt-hour. This dramatic reduction represents a steep drop from current rates and could eliminate much of the financial incentive for residential solar investments across the state.

The cuts would be especially severe during winter months, with compensation dropping by 80% from October through May. If approved, these changes would take effect June 1, just as peak solar production season begins.

The proposal creates a notable disparity in how energy is valued. While Idaho Power charges customers at least 8 cents per kilowatt-hour for electricity, they’d pay solar owners less than 1 cent for energy sent back to the grid.

Solar customers would still face a $15 monthly fixed fee, which has already tripled from $5 in recent years. These higher fixed costs hit lower-income households hardest and further erode the benefits of home solar systems.

Many solar owners now find themselves in a difficult position. They’re making loan payments for solar installations while simultaneously seeing their expected power savings diminish under the utility’s shifting compensation structure. The proposal represents a 72% decrease from the 8.8¢ per kWh rate previously offered to solar customers.

The changes are part of Idaho Power’s new “Net Billing” program, which replaces traditional net metering. Under this system, solar export rates would be recalculated annually, creating uncertainty for current and potential solar adopters.

The utility claims these rates reflect the “true value” of rooftop solar exports based on their internal study. However, critics argue the study uses selective data and flawed methods that undervalue distributed solar’s benefits. This approach contradicts the global trend where renewable energy adoption is steadily increasing due to its environmental and economic advantages.

More than 70 homeowners and solar stakeholders have voiced opposition at public hearings. Environmental groups contend the rates severely undervalue solar’s positive grid and community impacts.

The Idaho Public Utilities Commission is expected to decide on the proposal in May. If approved, experts warn Idaho’s rooftop solar market could stagnate, affecting clean energy jobs and setting a concerning precedent for other states.

The Idaho Conservation League continues to fight against these changes, having previously defended net metering policies in multiple cases over the past five years.