Net Metering – the Debate Rages On
Today’s Renewable News Top Picks: Tucson Electric Power changes its mind on net metering, Iowa utilities refuse to net meter third-party owned solar arrays, and Report: Net metering policies drive solar growth.
Current net metering rules provide TEP’s solar customers with bill credits worth nearly twice as much as TEP pays for energy from large solar arrays. In order to recoup costs, TEP increases the energy rates, paid for by those customers without solar. But, under TEP’s revised net metering proposal, the utility would purchase excess output from rooftop arrays for the same price it pays for power from community-scale systems, thereby paying what they feel is a fair price for excess energy without having to raise rates for non-solar users. A win-win for everyone, yes?
Actually – the price of lowering the value of distributed solar generation is that you’ve just made individual rooftop solar less appealing, with a pay-back period that discourages investment in this technology. Though we understand the utility has to make money, we don’t understand penalizing the solar users for the utility’s lack of forward thinking. And when did any business get to set their revenues at a pre-determined guaranteed level. No income should be guaranteed. Find another revenue source!
Alliant Energy and MidAmerican Energy, two of Iowa’s dominant electricity providers, are refusing to net meter solar installations financed in third party ownership (TPO) arrangements, challenging assumptions in a 2014 Iowa Supreme Court decision that upheld TPO deals. The utilities argue that Iowa Utilities Board rulings limit net metering to customers who buy all their power from the utilities.
Here again is the crux of the entire battle with utilities over PPAs (TPO) and their refusal to recognize third party ownership in Iowa and other states. PPAs are the backbone of the current rise in solar development, and require net metering at retail rates to succeed. Without supporting third party ownership, which shoulders the bills for development, installation and maintenance, solar will not be the attractive option it currently is for so many host properties; i.e. schools, businesses, organizations, etc. Once again, utilities are looking to crush the solar market to retain their own revenue base. Time to change…
The latest report from Environment America, released today, finds that net metering is the biggest reason for the current solar boom. The report also indicates that net metering makes solar viable for those installing it, while offering even greater benefits to the grid and society in general. But states, like Wisconsin, Iowa, Michigan and Ohio continue to take the attitude that net-metering unfairly benefits solar owners at a cost to all other utility customers. But this report quantifies not only the immediate cost of solar energy, but also the larger benefits of distributed solar generation, estimating the dollar value of factors including: avoided environmental compliance, grid resiliency, reduced financial risk and avoided capital investments, compared to other forms of generation.
Finally, data has been delivered supporting net metering and putting to rest the empty arguments made against net metering by the utilities. “When [utilities] argue about the cost of solar they never use any specifics, they’re generalized arguments that don’t reflect the level of solar penetration and don’t reflect any benefits that solar brings to the grid,” said Brad Klein, senior attorney for the Environmental Law & Policy Center (ELPC). And frankly – we couldn’t have said it better; “The bottom line is the report shows solar power’s rewards are greater than its costs and we should be encouraging more distributed solar energy across the U.S., and not penalizing it,” said Environment America Solar Program Coordinator, Bret Fanshaw.