As the number of solar rooftops across the U.S. increases, it becomes increasingly important for policy makers to make smart decisions about how to compensate solar customers for the power they produce. If done wisely, net metering can help solar power grow responsibly. If not, it could result in non-solar customers paying more for their electricity and endanger the long-term future of solar power. PACE has paid close attention to developments in the net metering debate and provides the following update on happenings around the country.
Bad metering policies can result in some customers not paying their fair share for the cost of the electric grid. A recent editorial from The Detroit News urges state legislators to avoid punishing non-solar customers, who tend to be middle and low income, while crafting new renewable energy laws. The editorial also correctly points out that the retail rate paid by consumers includes several costs such as grid maintenance and security, and all customers should be responsible for these costs.
From Berkshire Hathaway
In July, Berkshire Hathaway Energy, the holding company owned by Warren Buffett, released a strategy document outlining the company’s position on net metering. The company called for net metering to be outright scrapped in favor of a system that recognizes fixed grid costs and utilizes distributed generation more efficiently. “Maintaining the status quo and allowing DG customers to continue to be served by residential rates that do not reflect the costs of serving DG customers and which shift costs to other customers is arguably the situation that would be deemed unreasonably discriminatory,” the company explained.
Arizona’s largest utility originally repaid rooftop solar customers at the retail rate. But as the number of solar customers grew, the danger of cost shifting from some customers to others became a real possibility. Last year, recognizing this possibility, PACE joined the debate by issuing a white paper that expressed our concerns about the precedent Arizona’s net metering decision could set. Now, however, more middle-income voters seem to be seeing the big picture. Last week, the state held a Republican primary election for two of the four seats on the Public Service Commission. Both the two winning candidates campaigned for a system that ask all customers to pay their fair share for the grid.
In Wisconsin, three utilities have filed rate cases that involve net metering issues. The utilities will propose an additional monthly charge on distributed energy installations and a prohibition on solar installations owned by a third party from interconnecting to the grid. “We want to make sure the costs for maintaining our electric system are shared in a fair manner, that is more representative of where those costs lie,” said a spokesman for We Energies. The Wisconsin cases are still pending.