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Policy & Politics

America’s Net Metering War

Originally published on San Diego Loves Green
by Roy L. Hales


(California Solar supporters during the AB 327 negotiations – TASC photo )

There is an undeclared energy battle being waged in America. As installation costs drop, rooftop solar is spreading throughout the US and, while reducing the nation’s carbon footprint, it also cuts into inflated corporate profits. Despite three resounding setbacks, utility companies are fighting to hold on to their monopolies. They are doing this by trying to limit net metering, the cornerstone policy that gives solar customers fair credit for the excess energy they put back on the grid.  The Alliance of Solar Choice (TASC) says two of the hottest battles are currently being fought in Arizona and Colorado.

The tide of rooftop victories started on June 26 of this year, when the Louisiana Public Utilities Commission voted 3-2 to maintain the payments utilities must make to solar owners.

Bill, a residential solar owner from Arizona – TASC photo

Bill, a residential solar owner from Arizona – TASC photo

This was followed by the Idaho Public Utilities Commission decision, early in July, to reject the utility’s petition that they be allowed to raise the monthly fees that solar owners must pay them.

Although events started in a similar vein, they took a radically different turn in California.

In the last few weeks before AB 327 came to a vote, the state’s Investor-Owned Utilities, solar industry, and ratepayer advocates came together to make Bill AB 327 a piece of legislation they could agree on. As negotiations went forward, a stream of often contradictory messages went out to the public.

“It’s understandable that there is still confusion about AB 327 because so many changes were made in the weeks before the vote,” said Susan Wise, a spokesperson for TASC. “The bill helps ensure solar and net metering stability in California by removing arbitrary limits on solar growth.  It brings a level of certainty to net metering that has not existed before in California. ”

Once signed by the governor, AB 327 puts legislation in place to:

  • Remove the current suspension on net metering that would have otherwise gone into effect at the end of next year.
  • Eliminate uncertainly over how the current net metering cap is calculated.
  • Provide a framework for removing the net metering cap altogether.
  • Provide certainty that net metering customers’ investment expectations are respected.
  • Remove the 33% ceiling on the state’s Renewable Portfolio Standard. Now there is no limit.

The passage of AB 327 is a model of what can happen if everyone works together for the common good. Unfortunately it is not yet being followed in either Arizona of Colorado.

Xcel Energy wants to diminish Solar Rewards program incentives from 9 cents per kilowatt hour to less than a penny, or else cut the size of the program (6 megawatts from 36). They also want to eliminate net metering as it exists today.  They conducted a study on rooftop solar that had not undergone review by the public or the Public Utilities Commission.  The study uses data    from a small number of meters from larger, usually commercial installations in 2010 and 2011.  Meanwhile, there are 17,800 residences and small business with net metered solar. ”We need better information than that,” said Edward Stern, executive director of the Colorado Solar Energy Industries Association.

“The study uses non-current data from as far back as three years ago, and cites outdated studies, the most recent of which was completed more than four years ago,” said Meghan Nutting of TASC.

Vote Solar’s own calculations show rooftop solar provides the state with a net benefit of $11 million.

Andy, Another residential solar owner from Arizona – TASC photoA similar factual discrepancy is found in Arizona, where the Arizona Public Service Co (APS) claims non-solar customers are subsidizing solar customers to the tune of $18 million per year.

That prompted Commissioner Gary Pierce, of the Arizona Corporation Commission, to have his staff look into the situation.

In the Pierce Report, Staff has recommended that nothing be done until the utility’s next rate case in 2016.  Staff’s report rejects the APS proposal.

A vote is anticipated in the next few weeks.

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