AMARILLO, Texas (July 25, 2023) – Xcel Energy is reminding Texas customers to know and understand policies regarding rooftop solar installations before signing agreements with companies that sell solar panels to power homes and businesses.

“Customers who generate their own electricity with home solar panels generally want to stay connected to the central power grid for backup purposes,” said Brad Baldridge, director of Customer and Community Relations for Xcel Energy. “And some customers are looking to sell back surplus energy.”

Baldridge said it’s important for customers to contact Xcel Energy before finalizing a deal so they can understand the policies related to connecting home solar generating systems to the grid and know what they’ll be paid for surplus electricity. Customers should also be aware that the system they are purchasing must be compatible with the Xcel Energy’s grid. Xcel Energy does not market rooftop solar systems and is not in partnership with companies marketing solar systems directly to customers.

Xcel Energy’s Texas rates are regulated by the Public Utility Commission of Texas, and under the rules now in place, customers who wish to connect home solar systems to the local distribution grid for backup or to sell surplus energy have two options: 

  • The first option allows customers to generate their own power to lower monthly bills. Under this option, there is no compensation from Xcel Energy for any surplus power flowing back on the grid.
  • Under the second option, Xcel Energy will install a special meter for a $20 monthly service fee that tracks the amount of surplus electricity placed back on the grid, allowing the company to compensate customers for that surplus electricity at an “avoided fuel cost rate.” This rate is based on the ever-changing cost of coal and natural gas purchased to generate electricity at area power plants. This avoided fuel cost is lower than the total retail electricity cost, or the per kilowatt-hour rate, seen on customer bills. In July, for example, the avoided fuel cost rate applicable to rooftop solar generation is 2.5 cents per kilowatt-hour.

Solar policies vary greatly by state. These policies pertain to Texas customers only. More detail can be found at xcelenergy.com/texasrooftopsolar.

Xcel Energy strongly encourages Texas customers to contact the company’s engineering group to fully understand the rules governing compensation for surplus electricity prior to making a decision to purchase a solar system, and to ensure the system they are purchasing is compatible with Xcel Energy’s electrical facilities. Inquiries can be made through email to DERinterconnectionTX@xcelenergy.com. 

About Xcel Energy

Xcel Energy (NASDAQ: XEL) provides the energy that powers millions of homes and businesses across eight Western and Midwestern states. Headquartered in Minneapolis, the company is an industry leader in responsibly reducing carbon emissions and producing and delivering clean energy solutions from a variety of renewable sources at competitive prices. For more information, visit xcelenergy.com or follow us on Twitter and Facebook.

###