The way rates have historically been calculated can making it difficult for customers to plan solar investments because forward prices are often volatile.

The graph below shows how rates for direct generation and net meter surplus generation have changed each year. These changes reflect the ups and downs of the wholesale power market.  

In contrast, under the avoided cost methodology solar rates are tied to the costs EWEB avoids by using customer-generated solar instead of procuring energy from other resources. Because these inputs reflect actual market conditions, utility needs, and EWEB’s specific energy contracts, solar customers can expect more predictable rates.

Avoided cost inputs include factors such as EWEB's supply contracts with Bonneville Power Administration and others, market prices for energy and Renewable Energy Certificates (RECs), savings on capacity and transmission, and the cost of new generation resources. Because these inputs evolve over time—though not as frequently or unpredictably as forward market prices—EWEB will likely review and adjust the avoided cost annually or biennially to ensure the Renewable Net-Metered Rate and Renewable Generation Purchase Rate remain aligned with market and utility conditions.

As shown in the table below, 2025 rates using the current methodology of forward prices have decreased to a level approaching the avoided cost rate. The following table shows the 2025 rates approved by EWEB's elected Board of Commissioners, with the avoided costs shown for reference.

*Shown for reference only. To align with the principle of gradualism, full implementation of the Avoided Cost methodology will be deferred until the 2026 annual update. 

While these net metered and direct generation rates are important, it is crucial to note that they represent relatively low value in the broader picture. Solar customers primarily benefit from avoiding the need to purchase some or all of their electricity at retail rates. The savings from offsetting retail energy costs, which can be much higher than the rates for net metering or direct generation, are typically far more significant for customers’ financial outcomes. 

Benefits of Avoided Cost Approach

• Stability: Because avoided costs reflect actual market conditions, utility needs, and EWEB’s specific energy contracts, solar customers can expect more predictable rates. 
• Transparency: Net meter and direction generation rates will be based on clear, resource-driven factors, ensuring that solar customers understand how they are compensated for the energy they provide to the grid. 
• Fairness: The avoided cost method ensures that solar compensation reflects the actual value of the resource to the utility and all customers, maintaining equity across the system. 
• Responsibility: By aligning compensation with the cost of acquiring new energy resources, this approach supports responsible financial planning. 

Some EWEB customers are interested in rooftop solar as an option to advance clean, local energy and provide resiliency during emergencies or outages. At the same time, customers with distributed solar resources are still connected to EWEB’s grid. These customers rely on EWEB for energy at night and during the winter when their panels aren’t producing. They also rely on EWEB’s distribution and transmission lines when they sell surplus energy back to EWEB. 

As a matter of principle, EWEB believes that costs should be equitably shared among all customers. EWEB incurs significant costs to maintain a robust distribution system and procure energy for all customers, even those with distributed generation technologies. Because EWEB currently collects revenues for transmission and distribution (delivery charges) based on usage, net-metering policy design can result in under-collection of funds from customers with distributed generation. For this reason, EWEB will continue to evaluate and update its rate designs and distributed generation policies to ensure that these align with EWEB’s values and principles. 

Learn more about EWEB's principles for customer-owned generation, such as rooftop solar.