"Embedded Cost" means the approach whereby the bill credit value is calculated by multiplying (1) the subscriber’s share of the kWh electricity production from the facility and (2) the subscriber’s retail rate, with the value potentially adjusted to remove certain rate components (e.g., the distribution charge).
"Value-Based" means the approach whereby the bill credit value is calculated by multiplying (1) the subscriber’s share of the kWh electricity production from the facility and (2) the value of the electricity produced as determined by the responsible regulatory body or agency, taking into account costs and benefits.
Please refer to IREC's "Model Rules for Shared Renewable Energy Programs" for a more thorough discussion of bill credit valuation approaches.
A utility's "avoided cost rate" reflects the cost the utility would have incurred for the same amount of energy acquired through another means such as construction of a new production facility or purchase from an alternate supplier. Avoided cost is typically used to calculate the rate for Qualifying Facities (QFs) under the Public Utility Regulatory Policies Act of 1978 (PURPA). Therefore, a utility's PURPA QF rate or tariff could be a place to look for this rate comparison.