They create solar disincentives that in the long term will undermine the public’s ability to benefit from private investments in solar and battery storage.
by Vaughan Woodruff, president of Insource Renewables in Pittsfield and chair of the Committee on Renewable Energy, the trade association for Maine-based solar contractors
Portland Press Herald op-ed
PITTSFIELD — The Maine Public Utilities Commission recently announced a new rule that will significantly alter the relationship between the state’s electrical monopolies and Mainers who install solar in 2018 and beyond. This rule contains some of the most anti-solar provisions in the country and demonstrates a continued failure to leverage the economic power of an industry that is demonstrating huge job gains and capital investment across the country.
The PUC’s actions are not surprising, given the commission’s failure to provide a rigorous analysis of the impacts of either our current net-metering rules or their newly introduced ones. As a result, the PUC has needlessly created a series of conclusions with unpredictable consequences.
Though no other state in the country has introduced a grandfathering period of less than 20 years – including those with far more solar than Maine – the PUC called for a 15-year grandfathering period. This provision is particularly egregious since it affects not only those who will buy solar in the future, but also those who have already invested in the technology.
The PUC also announced new bureaucratic requirements that will increase the cost of solar installations. In order to implement the most controversial and extreme provision, Maine homes and businesses will need to install a second, dedicated meter to allow the utilities to measure the total amount of electricity generated by their solar installation. There are questions regarding who will pay for the meter, but it is anticipated that this change could increase systems costs by $500 to $700 – even if the utility forces other ratepayers to cover the cost of the additional meter.
This additional equipment will be used to ensure that solar customers pay the utilities for electricity that never leaves their site. Currently, utilities measure only the electricity that is delivered to the grid from a solar energy system. The purpose of installing an additional meter is to a levy a fee on solar owners for all of the electricity they generate, including electricity that powers the owner’s property and never enters the utility’s transmission infrastructure.
With this change, the PUC has concluded that Maine utilities have a right to earn revenues on energy that solar customers avoid buying by simply reducing their energy demand from the grid. This is the equivalent of paying a fee to Central Maine Power for reducing one’s electricity consumption by installing LED lighting, using a woodstove instead of electric heat or getting rid of an extra freezer. There are significant concerns about the legality of this provision.
One of the most ridiculous consequences of this rule change is that solar customers who have batteries and are connected to the grid will be forced to pay CMP for a portion of the electricity they use when the grid is down. I think most readers can imagine the outrage if homeowners with a gas generator were required to pay CMP for a portion of the electricity they generate during a power outage.
These are expected results when a process is heavily dependent upon bureaucrats and utility interests and ignores the expertise of those who actually do the work. The PUC failed to take into account many of the comments provided by the general public and local industry.
It ignored the benefits that solar owners provide to other ratepayers by reducing peak demand on the transmission grid and expensive power plants.
It ignored the industry’s input regarding the implementation of the state’s net metering rules.
It ignored input from everyone – even the utilities – regarding the complexity of implementing a more complex accounting method. When presented the opportunity to “review” net metering, the commission made broad assumptions and proceeded to act.
The new rule includes some glaring impacts on all other ratepayers as well. One of the most direct consequences is requiring ratepayers to pay CMP to amend its billing system to accommodate the extremely complex new rules. Net metering is fairly simple. The PUC’s new rules are not, and they will vastly complicate CMP’s accounting. Ratepayers will be required to foot the bill for this.
The short-term result of these changes will be an increase in solar installations in 2017 as homes and businesses rush to get in ahead of the new rule. The long-term consequence is a series of disincentives that undermine the public’s ability to benefit from private investments in solar and battery storage to make our grid more affordable, predictable and resilient.
Fortunately, the Legislature has the opportunity to act before this rule takes effect. Let’s hope they take a more practical approach than the one offered by the PUC.