You’ve decided you want to switch to solar. Maybe the soaring cost of natural gas was the last straw, or maybe it was the 30% tax credit passed in the Inflation Reduction Act that encouraged you to get panels on your roof.
Before you can start tapping the sun for energy, however, there are a few steps to take. And those steps are taking much longer as of late, at least partly because of Xcel Energy.
When a homeowner decides to install solar panels on their roof, there are two points where the utility is involved. The first is approving an interconnection application ahead of installation, and the second is connecting panels to the electric grid afterward. The application, typically submitted to the utility by the company you pick to install your panels, includes information about the panels, a site plan, and historic energy use of the home — ensuring you don’t install panels only to have the utility unable or unwilling to hook them up to the grid.
In Boulder and across Colorado, Xcel has been processing these applications at a much slower pace than it did a year ago, triggering a state lawmaker to propose an amendment to legislation forcing quicker approvals.
According to Namaste Solar, a Boulder-founded, employee-owned solar installer, the average number of days it took Xcel to approve its interconnection applications in the third quarter of 2021 was 43.6 days. In that same time period a year later, it took Xcel 139.7 days — more than three times longer. This meant projects stalled and new staff had to be shuffled to other areas of Namaste’s business to avoid layoffs.
“At a time when solar could be booming and we should be making real progress towards our clean energy goals, instead we’re running into additional roadblocks,” said Eliot Abel, a senior director at Namaste Solar.
Carolyn Elam, a senior sustainability manager for the City of Boulder, said Boulder residents have been turning to the city for help as their solar applications remain stalled.
“We’ve certainly heard from residents who have been caught up in delays, who have been waiting many months,” she said. Elam added that when these residents reach out through normal channels for assistance — like the email on Xcel’s interconnection webpage — they’re often unable to get a satisfying explanation for the delays from either Xcel or their solar contractor.
“There’s an absence of transparency in the process for the end customer,” Elam said. “They have no way of knowing whether their contractor is telling them the truth, or Xcel is telling them the truth.”
Elam said contractors were telling residents they have left “15 messages for Xcel.” Xcel, conversely, has blamed the contractors.
In February 2023, Xcel told the Colorado Public Utilities Commission that one reason the interconnection applications are stalling in its system is contractors aren’t filling them out correctly. Abel told Boulder Reporting Lab this couldn’t account for all the delay.
In Namaste’s case, “we’ve been doing this for 18 years,” Abel said. “We’re not exactly new to the game. I think we know how to submit applications for interconnection.”
Abel had a different opinion on the cause of delays, which started about a year ago. “I don’t think it’s lost on anyone that when Xcel turns on a solar system, there’s less revenue coming in the door,” he said.
Elam said she believes the delays are “a capacity issue” — as well as a prioritization issue.
By capacity, Elam means having enough staff to review applications in a timely fashion. If there were more employees to assess interconnection applications, more solar panels could be up and running. “Maybe there’s outsourcing or other things [Xcel] could do to handle high-flux periods in a more timely way,” she said.
Abel described the lack of capacity as a decision. “Looking at what Xcel profits have been for the last couple of years, they have the money to invest in staffing,” he said. (Xcel, which supplies most of Colorado’s electricity, reported $1.736 billion in net profits in 2022.)
Impact on the solar industry as demand grows
Coming out of the pandemic, interest in solar swelled, according to Namaste. People were spending more time at home, using more electricity and natural gas. So when gas prices took flight, solar was a no-brainer for many. The increase in business led Namaste to grow its staff. But as applications stalled, business slumped. Without approval on interconnection applications, solar panels can’t be installed.
Abel further explained that even after interconnection applications are approved and Namaste and other solar companies are able to move forward and install panels, it can be months before Xcel comes out and hooks them up to the grid. Xcel was fined $1 million in 2021 for delays in hooking up installed solar panels to the grid in its Minnesota territory.
“We have laws in Colorado, whether [utilities] like it or not, that allow someone to put solar on their roof and interconnect to the grid,” said Steve Fenberg, president of the Colorado state Senate and the senator representing Boulder.
Fenberg said the volume of new customers moving towards solar might explain Xcel’s delays.
“In the past, [residential solar] wasn’t a large enough portion of the grid for [Xcel] to care that much,” Fenberg told Boulder Reporting Lab “But now, more and more people want to put solar on their roof.”
So while Xcel might not be actively dragging its feet, “they don’t have a huge incentive to comply,” he said.
For more than a century, the U.S. energy market has been dominated by large utilities like Xcel and fossil fuels. Rooftop solar, turning individual homeowners into providers of energy, challenges these utilities’ traditional business models.
Xcel has acknowledged the delays and has apologized to customers. Michelle Aguayo, a media relations representative for Xcel Energy, told Boulder Reporting Lab that Xcel is starting to return to previous hookup times after working through a backlog that was “largely due to federal and state incentives” encouraging solar installations.
“We completed more than 18,000 applications in 2022,” Aguayo said, “a 34% increase compared to the previous year.” Aguayo said Xcel received 13,415 applications in 2021 and 18,912 applications in 2022, a jump of more than 40%. The company told CPR it hired 20 additional engineers since January 2023 to process applications.
Abel of Namaste said moving forward, more granular data should be obtained to better understand delays.
“What’s the overall timeline from when the application was submitted to when it was approved, and from when the system has been installed to when the meter gets set?” he said. “We don’t care as much about some intermediate milestone of, ‘Once the application was deemed complete and correct by Xcel, here’s how quickly they moved.’ What about the three months it took to review the application?”
Legislation proposed to speed up solar hook-ups
One way for state regulators and lawmakers to get Xcel to speed up is by levying fines or passing legislation.
“You have to hit them in the wallet,” Abel said. “You have to hit them in shareholder profits. If there aren’t dollars involved, it’s pretty hard to hold them accountable.”
Senate Bill 16, now in the state legislature, could have an impact on hook-up delays. The bill, sponsored by Senator Chris Hansen, who represents Denver, mandates greenhouse gas reduction measures. An amendment to the bill is in the works that would create a per-day penalty for utilities’ tardiness in connecting customers’ solar systems to the grid. How much that penalty would be, and what constitutes a delay, is still being discussed, though Hansen told CBS Colorado that hookups should take “90 days maximum, absolute maximum, it really shouldn’t be any more than five to six weeks.”
“One way or another, we will probably be taking action on that topic this session,” Fenberg said.
Abel of Namaste Solar said that since the issue has received attention, interconnection application times have improved, at least on the residential side of things. But things are by no means fixed.
“Where we’ve seen improvement in application approvals on the residential side — because they’ve been pressured and there have been homeowners talking about it — we have not seen as much improvement on the commercial side,” Abel said. “There’s real damage that’s been done.”