The measure endorsed by the Legislature’s energy committee calls for a cost-benefit analysis of how utilities pay homeowners and small businesses for the electricity they generate.
By Tux Turkel, Staff Writer
Portland Press Herald news story
AUGUSTA — A bill that would keep current financial incentives for rooftop solar in place pending a cost-benefit study cleared a legislative committee that handles energy matters Thursday, but opposition from House Republicans foreshadowed another battle over renewable energy between Democrats and Gov. Paul LePage.
By an 8-4 margin, with one Republican member absent, the Legislature’s Committee On Energy, Utilities and Technology voted out a bill that would direct the Public Utilities Commission to perform a cost-benefit analysis on net-energy billing, or net metering. That’s the practice in which utilities compensate homeowners and small businesses at the full retail rate for the power they generate from solar arrays.
The bill would have the PUC develop a proposal for a new, market-based system that would include a provision to vary compensation based on the time of day power is generated. The agency would present its findings to the Legislature in 2021.
The committee also voted out a bill aimed at expanding the use of solar electricity by large users, such as businesses and municipalities. House Republicans also opposed that measure, which passed 7-3.
Both bills were sponsored by Republicans, and were supported by the committee’s Republican co-chair, Sen. David Woodsome, R-York. But hours before the vote, House Republicans on the panel changed their positions, reflecting opposition from LePage as expressed by his acting energy director, Angela Monroe. That led to a minority report on the net metering bill, featuring a different approach that – in turn – was opposed by Democrats.
Taken together, these actions provided a preview of a pending fight in the full Legislature this month, reminiscent of one last year. This time, however, the stakes for Democrats and their clean-energy allies are higher.
The debate over state government’s role in encouraging solar electric generation in Maine has grabbed a lot of attention in recent years. Advocates of continued or expanded financial incentives see them as investments that pay off in clean, locally produced energy and jobs that are the foundation of a growing industry. Critics, including LePage, see added rates that shift costs onto other electric customers.
At the heart of the dispute has been what to do about net metering. Last year, a broad solar bill that would have set up a new form of compensation failed by two votes when the Legislature couldn’t override a veto by LePage. That set the stage for a proceeding at the PUC, which ended in a pending net metering rule that would gradually reduce the incentive, beginning in 2018.
That rule was widely criticized. Solar installers said the rollback and other elements would cripple their industry and stunt the kind of job growth taking place in other states. Environmental groups gave notice that they will go to court to challenge the rule. LePage, meanwhile, said it still was too great a burden on ratepayers.
As a result, there’s a lot of political pressure on lawmakers this spring to do something, to find some compromise.
“Maine is at a solar crossroads,” said Dylan Voorhees, clean energy director at the Natural Resources Council of Maine. “If the Legislature fails to act, the PUC’s extreme new net metering rule will go into effect, costing ratepayers millions and moving Maine further backwards away from a solar future.”
Voorhees’ group threw its support behind a bill that would have preserved net metering and offered rebates to customers to install rooftop solar panels. It was sponsored by Rep. Seth Berry, D-Bowdoinham, who co-chairs the energy committee.
Activists turned out for a public hearing, wearing yellow T-shirts and waving signs. Despite that passion, the proposal never gained traction with Republicans. After trying to scale back the incentives, Berry acquiesced and allowed his bill to be tabled.
After Thursday’s action, Berry said he was disappointed that House Republicans on the panel couldn’t support the net metering study bill. He said he hoped enough Republican votes could be cobbled together in the full Legislature to keep the PUC rule from taking effect in 2018.
The community and commercial solar bill is aimed at expanding larger-scale projects. It directs the PUC to enter into 20-year contracts for 90 megawatts of community solar generation by 2021, and 60 megawatts of commercial generation by 2020. The commercial generation also includes a portion for farm and forestry businesses. For comparison, a five-megawatt solar project can generate enough power to serve 1,000 homes.
Debate over the community and commercial solar bill centered on a familiar theme: The cost to ratepayers versus the wider economic impact.
Monroe offered her take, which she based on different projections of future wholesale power markets. For instance: Purchasing 90 megawatts of capacity, she said, could cost ratepayers $71 million over the 20 years, if the cost is 3 cents above market rates.
But Berry countered by saying volatile natural gas prices could make solar a welcome hedge for electric customers, offering stability. He also referred to a federal energy department economic model that calculates the solar bills could create 1,000 new jobs over four years.
These are among the conflicting points of view that will color debate over the solar bills in the full Legislature.