Net Metering Debates Heat Up

Net metering policies evolved in several states this year, including Michigan, Connecticut, and Maine. Meanwhile, other states such as Kentucky saw heated battles sure to return.

PACE supports changes in net metering laws that bring more fairness to the system – paying retail rates instead of avoided costs for net metering subsidizes electricity bills for a small number of residents and puts more costs on low and fixed-income families.

Increasingly, states are taking a hard look at their net metering policies and aiming to bring payments in line with market rates, despite strong pushback from the renewable energy industry.

Net metering reform continues as one of the most controversial battles in domestic energy policy. This year, Michigan and Connecticut passed important reforms that bring fairness to net metering payments. Maine’s Governor Paul LePage protected consumers by once again vetoing legislation that sought to undo similar reforms in his state.

At PACE, we support policies that promote affordable energy for all. We absolutely believe in the value of solar as a clean, renewable energy source.

But if states sustain true net metering, they are essentially saying that private solar electrons (rooftop or ground-mount systems at an individual home or business) are worth more and that everyone must chip in to pay for them.

It’s important to protect against policies that allow a small number of customers to have their energy costs subsidized by everyone else, including many low and fixed-income families.

States are right to carefully examine their net metering policies to ensure net metering payments accurately reflect private solar grid benefits and costs, and that those payments don’t distort the energy marketplace by paying excessive rates for private solar generation.

We’ll keep you posted on the latest developments with net metering as debates continue across the country. This fall, watch for an update of our 2017 report. We’ll provide a snapshot by state and U.S. territory of the current policies, recent significant developments, and our assessment of whether policies properly value all consumers.


Hedging Happens Every Day

Everyone needs to manage risk. We do it in our daily lives both personally and professionally. Utilities are no different. PACE has spent the last few weeks highlighting natural gas hedging after the Missouri legislature passed a resolution supporting the continued use of this essential, though often misunderstood practice.

Today’s infographic explains the top five benefits of natural gas hedging, from protecting consumers to supporting national security. We hope you will find this  graphic useful as you think about all the ways you manage risk every day. #HowDoYouHedge?


A Sea of Change in Charleston

It’s 90 degrees in the shade here in Charleston, South Carolina, where the Southeastern Association of Regulatory Utility Commissioners (SEARUC) has gathered for its annual meeting. Eleven states’ public utility regulators, from Texas and Arkansas to Florida and the Carolinas, are represented. This year’s theme is “Effective Utility Regulation – All in the Public Interest.” In a time of increasing cynicism about government, it’s uplifting to focus on elected officials and professional staff who work hard for consumers each day.

It’s also refreshing to be with so many who accept that appropriate regulation is needed to monitor and provide course corrections for the complicated systems that ensure utility services reach millions with nearly 100 percent reliability. Another constant, if unofficial, theme here is change. In over three hours of keynotes, CEOs and Commissioners kept us thinking hard about change patterns and impacts.

Change in the energy industry isn’t easy to discuss, especially in light of the shockwaves that rolled across South Carolina after trying something new (V.C. Summer) that didn’t turn out as planned. However, across the morning, message delivered and received, that a combination of elected officials + regulated industries + consumers + constructive dialogue is absolutely critical to helping our nation and consumers dive into and successfully navigate change in the energy sector.

Investor-owned and not-for-profit utilities alike cited sharp declines in use of coal and increases in renewable generation – and reminded us that was often without any prodding from statutory Renewable Portfolio Standards.

Not one CEO or regulator here speculated about a 100 percent renewables future. Nearly all touched on the continuing need for natural gas to fill coming gaps caused by retirement of baseload coal and nuclear and to support intermittent renewable generation. DOE’s Bruce Walker shared a new storage research program aimed at developing batteries that can last ten hours or more.

South Carolina’s Mignon Clyburn warned against broadband complacency; too many U.S. citizens reside in a “digital canyon” and can’t participate in the energy evolution. South Carolina electric cooperative leader Mike Couick agreed – utilities aren’t too big to change, but without widespread connectivity, are bound to the expansive “steel and concrete” physical manifestations of the 20th century utility business model. Duke CEO Lynn Good brought the consumer into the room, discussing extensive survey work and noting the customers’ “uniquely loud voice” and expectation that utility providers talk to them in language they can understand.

Southern Company CEO Tom Fanning put consumer affordability issues front and center and created enthusiasm around the idea that “energy policy done right can give people hope,” citing the energy sector as a driver for economic freedom and job creation. If we all remember one motto from the morning, it might be Tom’s call for utilities, in partnership with regulators, to “learn, influence, compete and repeat” to navigate and successfully cross the sea of change.

At PACE, we endorse the idea that working together, utilities and regulators can successfully navigate the sea change in the energy sector all while benefiting consumers and powering  America’s economy.