Most members with DG systems such as solar, use the electric cooperative’s grid to buy power during times when their DG system is not producing enough power to meet their needs and sell power to their electric cooperative when their system may be producing more electricity than is needed.

Any DG system is required to have one meter with two registers installed to record the power flow in each direction. The first register will measure usage when the member is purchasing power from Riverland Energy. The second register will measure usage when the member is producing more power than is required and is put back onto the Riverland Energy system.

This excess energy produced by the DG system is stored on Riverland Energy’s system as your battery. The excess kWh’s are stored on the system for you to use throughout the month. Any excess kWh’s left at the end of the month, are paid out based on the average monthly peak avoided cost of Dairyland Power Cooperative, our power supplier.

What is Avoided Cost?

Avoided cost is what it would cost Dairyland to generate power or purchase power from another source.

Why do you pay avoided cost?

• Basic fairness to members is the rationale for the cooperative’s avoided cost rate.
• Electric cooperatives are not-for-profit, so this is a matter of consumer protection for all members and not about making a profit.
• The avoided cost rate compensates the cooperative for the costs it incurs to purchase and deliver kWh’s through the transmission and distribution systems.
• Asking the cooperative to pay a higher price for energy produced by a single member is not fair to other members.
• Because solar energy may not be available during peak periods, Riverland Energy must provide for the generation capacity and energy for those peak periods.
• The avoided cost changes monthly based on market prices.

The cooperative’s retail rate covers costs associated with generation, transmission, and distribution of electricity available to members on demand. Any member connected to the grid with access to virtually unlimited electricity on demand must pay a portion of the costs associated to deliver electricity to their property in order to achieve cost fairness among members.

As an electric cooperative, our DG policy & rate structures strive to maintain fundamental cost fairness among all of our members as a form of consumer protection.