A Solar Power Curve Ball
By Sheila Nataraj Kirby, John Fehlauer, Kenneth A. Colburn and Gordon M. Beck
In 2014, Maine’s legislature passed an act to encourage development of renewable energy resources. Apparently, the Maine Public Utilities Commission (MPUC) didn’t get the message – it has proposed rule changes governing solar power generation and pricing that are against the best interests of Maine residents, businesses and the declared intent of the legislature.
These rules, if enacted, will impair the growth of solar power in Maine – an area where we already lag behind.
A Climate to Thrive (ACTT) is an island-wide grassroots initiative whose goal is to move Mount Desert Island towards energy independence by 2030. ACTT has strong local support; our public programs in January and July of this year each drew audiences of over 200. We have submitted formal comments to the MPUC urging reconsideration of the proposed rule changes, but we also want to help you understand the adverse effects of the MPUC’s proposed changes on our island’s economy and environment.
A few basics of solar power generation and billing: When you install solar panels, you generate electricity for your own use. But you still receive and pay for any electricity that you need above that. If you use less electricity than your panels are generating, the excess electricity goes back to "the grid" for use by Emera’s other customers. Your monthly bill now represents the net amount of electricity you use.
This "net metering" or "net energy billing" (NEB) is where the trouble starts. It centers on how much utilities like Emera should pay solar owners for the power they contribute to the electricity grid.
The MPUC’s proposed rules would, over several years, reduce the value NEB customers receive for the electricity they supply to the grid. But a comprehensive analysis commissioned by the MPUC in 2015 concluded that solar power provides net benefits to all ratepayers – and to society as a whole – far in excess of the credit currently given NEB customers.
The MPUC’s proposed changes would completely ignore its own study’s findings, as well as similar findings from other states. The MPUC asserts that the costs of small solar installations will decline over the next few years, and says this justifi es lower NEB compensation. In short, the MPUC would mandate a guaranteed reduction in the compensation to NEB customers based on possible, projected future reductions in the cost of installed solar, with no provision to verify if or to what extent these cost reductions actually occur.
In addition, the MPUC’s proposed methods for measuring NEB generation and NEB customer usage are not well thought out, not clearly explained and could result in serious, unexpected impacts to NEB customers, including municipalities. NEB customers would be credited for the kilowatt-hours they generate, but credit for the transmission, distribution, risk, economic, public health and environmental benefits that they also provide would eventually decline to zero. Worse, the MPUC’s proposed changes would allow utilities to charge NEB customers for all electricity they use – even the electricity they generate and use themselves at their own premises. One Maine resident who submitted comments to the MPUC offered this wry summary: "If I understand your proposed rule changes, you want to charge me for the power that my panels produce. The pan els I have bought and installed. The panels that contribute to the grid supply of electricity that allows generators to not have to invest in new power generation projects.
"Isn’t this like charging me for the firewood that I grow on my property, that I cut with a saw and split with my axe ... and burn? Really? This doesn’t make sense."
We agree. First, under this billing approach, some NEB customers’ bills would increase significantly, encouraging such customers to go entirely "off-grid" as quickly as they can. Fewer customers on the grid means higher costs for the remaining ratepayers. Second, the proposed changes would make new installation of solar systems far less attractive to residents and businesses, hampering the creation of clean energy jobs in the state. This is completely contrary to the stated objectives of the legislature.
The proposed rule changes will virtually gut all efforts on MDI to move towards clean energy. We have over 500 kW of solar already installed on MDI; Bar Harbor’s community solar farm will be opening soon, a second is in process, and planning for others is underway. By significantly altering financial compensation for solar power, the proposed changes will have a clear, negative impact on MDI’s efforts and may result in higher taxes on citizens to pay for higher utility costs.
The opportunity to provide input directly to the MPUC closed on Nov. 2, but you can still let your state legislators know that you regard MPUC’s proposed changes as rash and backward. And please join ACTT for a presentation by experts on solar power at the Southwest Harbor Public Library on Wednesday, Dec. 14, from 5:30-7 p.m.Information on energy-related policies important to MDI and Maine’s economic and environmental future and other upcoming ACTT meetings can be found at http://www.aclimatetothrive. org.
The authors are active in the group A Climate to Thrive. This Op-ed was published in the MDIslander on November 23, 2016.