Senator David Woodsome, Representative Seth Berry, and members of the Joint Standing Committee on Energy, Utilities & Technology, my name is Dylan Voorhees and I am the Clean Energy Director for the Natural Resources Council of Maine (NRCM). Thank you for allowing us to present this testimony. Given the history of the policies in this bill, we believe the committee does not need a lengthy rehashed explanation of the issues. Make no mistake: this bill is not the least bit bold or comprehensive policy. It is an emergency bill that should be passed immediately to prevent some of the worst harms to consumers from the Public Utilities Commission rule.
In the briefest summary, the bill does four things:
- Prohibits gross metering, which is a utility fee on power generated and consumed behind the meter.
- Provides regulatory certainty by putting other parts of the new Commission rule in statute without substantive changes, includes the phased reduction of net metering credits for excess power (which NRCM opposes and believes is unsupported by the facts).
- Lifts the current arbitrary limit on community solar farms from 10 participants to 50, something the PUC said it did not have the authority to do.
- Requires a transparent cost-benefit analysis of net metering and distributed generation options, primarily from a ratepayer perspective, so policymakers can make more informed long-term policy in coming years.
The bill applies to all forms of distributed generation, not only solar. You will find the word “solar” does not appear in the bill except in the “Report” section, which requires the PUC to consider impact on solar installations in any recommendations.
The bill is obviously quite similar to legislation you considered last year but has notable differences. It contains so-called corrections made in response to legalistic utility concerns raised last session. It does decidedly less to expand community solar.
Now let me give you three reasons to vote for this bill:
- Rebalance a Regulatory Environment that Now Slants Dangerously Toward Utilities and Against Consumers
The adoption of net metering rules that include so-called “gross metering” is a dangerous, but unfortunately not unique, example of how our regulatory environment has shifted to favoring utility revenues over the interests of consumers. Directing utilities to charge a transmission and distribution rate or “delivery fee” on power that is used on-site and never touches the grid is a huge, unprecedented infringement on consumer rights.[1] This “behind-the-meter tax” is grossly unfair and discourages businesses and homes from making investments that lower demand on the grid, something that benefits all ratepayers.
To our observation, gross metering has never been justified to this committee or anyone else. The Commission and Central Maine Power have made claims about how providing bill credits for excess generation causes a rate shift. If those claims were true, it would still not justify intruding on power used behind the meter. We strongly disagree with those claims; however the Commission simply accepted CMP filings about “lost revenue” without question. Astonishingly the Commission has failed to even calculate whether weakening net metering in the way they have chosen will actually save or cost ratepayers money over the short- or long-term (something this bill would address).
Last summer, the Commission initiated a rulemaking to update changes to small generation interconnection standards and processes. The Commission ignored virtually all comments by non-utility parties and adopted virtually all recommendations by CMP. Earlier this winter, the Commission overturned its own staff and almost every party, who supported an independent coordinator for non-transmission alternatives (like energy efficiency and distributed generation). Ignoring obvious conflicts, they voted to follow CMP’s recommendation to put utilities in charge of these alternatives. Throughout the last 18 months the Commission has remained almost completely ambivalent to the fact that the gross metering will encumber all ratepayers with millions of dollars in unnecessary costs.
Central Maine Power is a private company with a fiduciary responsibility to their shareholders. It is their job to increase and defend their revenues, which comes from ratepayer spending on the electricity grid. It is the Commission’s job to balance the monopoly’s interests with consumers—and when they fail at that, it is your job to set the ship aright, even in small ways.
- Move Maine Toward New Technologies that Create New Jobs and Economic Opportunities
Maine needs new strategies to stay economically relevant in the 21st century. Many legacy industries and types of jobs have declined. Renewables and other clean energy technologies offer a substantial opportunity for new economic development and job creation. Our state is wealthy in renewable energy resources, but too many times over the last seven years, Maine agencies have taken actions that discourage investment in these industries in our state. (Just this week the PUC again put the brakes on offshore wind, the third time it has sought to renege on renewable energy contract terms agreed to previously.) Maine’s policy for solar power has gone from almost nothing to even worse, sewing market instability and sending the message that Maine is not remotely as open for solar business as our neighboring states. As a result, Maine continues to lag behind the entire region in solar jobs per capita.
Twenty-first century energy systems have the potential to be tremendously good for consumers. Distributed generation, storage, more control over usage, electrification to replace oil—these are all very good news for our grid and for consumers. And they tap into a huge new source of investment in energy equipment: ordinary homeowners and businesses!
I am not trying to exaggerate the magnitude of the impact this bill will have on our economy. I’m asking you to get the direction of the impact right—do something that helps a little instead of hurting.
- Choose Moderation and Compromise over Extremism
This bill is a close successor to LD 1504 from last year. This committee is well aware of the somewhat stressful process by which that comprehensive bill was trimmed down by this committee and further amended by the House. (Remember, LD 1504 started as a more comprehensive bill focused on small businesses and farms.) That final bill was a tremendous compromise. It was written and re-written by Republicans on and off this committee and, I’ll be blunt, Democrats ultimately accepted it.
I’ll give two examples of the compromises in both bills. The current 10-person limit on community solar farms is completely arbitrary and vastly limits access to solar. It discourages the larger-scale solar development that rooftop solar skeptics say we should encourage, whether on landfills or business parks or in other forms. Last year this committee passed LD 1504 with a new limit of 200 participants. That was the limit recommended by CMP in comments to the Public Utilities Commission.[2] (Subsequently CMP told this committee you should not lift the limit at all because doing so would encourage people to invest in solar under net metering!) The House amended that limit to 100. This bill would set it at 50. When are we done? Where is the reward for compromise? NRCM could easily be here demanding you go back to 200. It is tempting. Instead we say: pass the bill.
Second, this bill, even more clearly than LD 1504, tells the Commission to reduce excess generation bill credits for new net metering customers, starting with 10% this year. We oppose that change. The Commission should be required to do the cost-benefit analysis in this bill before weakening net metering. I could be telling you to change that. Instead we say: pass the bill.
Not passing this bill is giving into extremism—that would be putting ideology over practicality and the need to make information-based decisions. Gross metering is an extreme policy not based in sound information and it will take effect unless the Legislature acts.
As last session wound on and on, there were furtive efforts for more compromise on that already greatly watered-down legislation. Some of these did not seem to be in good faith and were aimed at delay. To prevent a repeat of that, we urge you to vote on this bill swiftly and move it forward with only minor technical corrections as needed. We all know that its fate will be determined on a veto override vote. Let’s get to it.
Thank you.
[1] If you disagree with almost everyone in this room and support the Commission’s adoption of gross metering, you may want to consider amending the statute to specifically authorize it, because a number of parties have made a strong case to the Law Court that it is illegal under Maine’s current law. Of course this should not be a matter that courts should have to decide, which is why we ask the Legislature to take responsibility to set policy.
[2] The Commission said changing this limit was a matter of legislative policy—which is odd, considering they invented the limit and they were comfortable making fundamental changes that weakened net metering.
