A compromise between solar users, regulators and utilities could head off a costly fight in Maine.
By The Editorial Board
Portland Press Herald editorial
There’s a battle going on between big polluters and a growing solar energy industry that is being fought in state capitals across the nation.
Nevada, Hawaii, Oklahoma and other states have scaled back their solar incentive programs, in campaigns funded by the petrochemical industry, especially the right-wing Koch brothers. Other states have stood their ground, maintaining their incentives, which motivate solar expansion but also shift costs onto non-solar utility customers.
Maine could be the next battleground in this winner-take-all fight, but it doesn’t have to be.
Instead, it could lead the way in creating a fair way to distribute the cost and benefits of solar power, creating a predictable long-term future for the industry so it can sustain continued growth.
Improved technology and lower costs have created a boom in rooftop solar in Maine. Last year, solar power reached 1 percent of Central Maine Power’s capacity, which triggers a review of the incentive system under state law.
Small-scale solar is subsidized in two primary ways. One is a federal tax credit. The other is a practice called “net metering,” under which solar customers sell any power that they produced but didn’t use on the electric grid, and draw power off the grid when the sun isn’t shining, paying only for the difference between the two.
It’s a policy that dates to the 1990s in Maine, when solar equipment was prohibitively expensive and there were few customers. But as costs have come down and solar installations become more common, problems are presenting themselves.
Grid-connected solar customers need a functioning electric system as much as anyone else on the system, but they don’t have to pay as much for it. Transmission costs are built into electric bills, calculated by the amount of power a customer uses.
It doesn’t matter to the grid whether electricity is coming or going, but solar customers’ payments for transmission are based on their net bill, which can be zero. Transmission utilities, like CMP, distribute their costs among the paying customers, so if someone pays less, others pay more.
Distributed generation from small solar does have benefits that everyone enjoys. Solar installations put more electricity on the grid during hot summer days when demand is highest, reducing the need for additional generation capacity and making blackouts less likely. And no-carbon-emission solar power does not contribute to air pollution or climate change.
The challenge is to find the right incentives to encourage solar expansion without burdening other users. An alternative concept that was laid out in a report sponsored by the Maine Office of the Public Advocate could strike the right balance.
Under this system, the Public Utilities Commission would designate an entity to buy all solar power that comes onto the grid from homes and small businesses for a specified price under a long-term contract. It would sell power and renewable energy credits in various markets, and the proceeds would be used to offset costs, to the benefit of all ratepayers.
The concept was outlined in a bill that unanimously passed the Legislature last year (L.D. 1263, sponsored by state Rep. Sara Gideon, D-Freeport), and has been fleshed out by a stakeholder group, which included solar contractors and environmental groups as well as utilities. It has one more meeting and is expected to issue a report that could reach the Legislature in bill form this year.
There’s a lot to like about the idea, especially the fact that it’s a compromise that would spare Maine a bitter conflict that could end net metering and leave no solar incentive in its place.
There are powerful national interests that would like to fight that battle in Augusta, but Maine lawmakers don’t have to let them.
They still have time to find a fair economic balance and let everyone benefit from the growth in solar power.