A draft report issued this past Friday by the Louisiana Public Service Commission adds fuel to the growing argument that net metering policies can shift significant costs from solar to non-solar customers. The report, entitled “Estimating the Impact of Net Metering on LPSC Jurisdictional Ratepayers,” finds a current cost-shift of more than $2 million, a number that could grow to more than $30 million by 2020 if left unchecked.
The report finds that costs associated with net metering in Louisiana far outweigh the benefits, with the negative cost already at $89 million and estimated to rise to between $125 million and $488 million. In addition, Louisiana’s taxpayer subsidy to solar customers has grown from an originally-estimated half a million dollars annually to $42 million per year, making it one of the most generous in the nation.
“Data shows that not only is Louisiana’s generous public subsidy for solar power unsustainable from a budget standpoint, but the net metering requirement for utilities is shifting considerable grid costs from solar customers to non-solar customers, including retirees and low-income consumers,” wrote PACE in a written statement distributed to the media. “We believe that is fundamentally unfair and that it is time for a change in Louisiana’s regulatory treatment of distributed solar.”
Of particular concern is data that shows that net metering customers have incomes on average 35% higher than non-solar customers, meaning the state’s net metering policy is shifting grid costs from those with more money to those with less. If left unchanged, the current net metering policy could cause non-solar customers to pay as much as $809 million more in years to come.
“In Louisiana, as is true in many other states, regulatory policy currently allows a small group of customers to use the power grid as a battery backup when they are unable to rely on their solar rooftop systems,” PACE’s statement asserts. “While there is nothing wrong with using solar, the power grid has a value and a cost that has to be borne by someone. Right now, as the report clearly shows, those costs are being shifted to less affluent non-solar customers, which is both unfair and unsustainable.”