Are Utilities Wilting From Heat of Solar Competition?

A man brooms in front of a house with solar panels on the roof in Grevenbroich near Aachen, southern Germany on September 11, 2012.
National Journal
Clare Foran
Add to Briefcase
Clare Foran
Dec. 23, 2013, 12:36 a.m.

Sol­ar en­ergy has be­come in­creas­ingly power­ful. Its rise to the top, however, hasn’t been without a few bumps along the way. 

Reg­u­lat­ory battles pit­ting the sol­ar in­dustry against power com­pan­ies in a fight over pay­ment mod­els played out in sev­er­al states this year. As the dust settles, sol­ar pro­viders are claim­ing vic­tory. Util­it­ies, on the oth­er hand, are try­ing to re­frame the con­ver­sa­tion en­tirely by in­sist­ing they aren’t an en­emy of the in­dustry.

Much of the de­bate so far has centered around a policy on the books in 43 states called net-meter­ing. Net-meter­ing al­lows rooftop sol­ar own­ers to sell ex­cess elec­tri­city back to the grid, with util­it­ies is­su­ing full re­tail cred­it to the cus­tom­er based on the amount of power they provide.

Util­it­ies are push­ing to scale back or get rid of net-meter­ing, call­ing it a sub­sidy that sol­ar has out­grown. The rooftop sol­ar in­dustry, on the oth­er hand, has res­isted the fight to dis­mantle net-meter­ing, ar­guing that it’s an equit­able way of pay­ing for power gen­er­a­tion.

In a series of high-pro­file cases this year in Ari­zona, Cali­for­nia, Idaho, and Louisi­ana, state law­makers and reg­u­lat­ory com­mis­sion­ers sided with in­dustry and moved to either up­hold or strengthen net-meter­ing.

“The na­tion­al story right now is quite clear,” said Bry­an Miller, the pres­id­ent of the Al­li­ance for Sol­ar Choice, a sol­ar-ad­vocacy or­gan­iz­a­tion. “There have now been four ma­jor ver­dicts on net-meter­ing, and in every case pro­posed reg­u­lat­ory changes to the policy have been re­jec­ted.”

A second point of con­ten­tion has been wheth­er util­it­ies should charge sol­ar cus­tom­ers ex­tra. Util­it­ies say ad­di­tion­al fees are needed to de­fray the cost of grid up­keep. Op­pon­ents say power com­pan­ies simply want to stamp out com­pet­i­tion.

In Novem­ber, Geor­gia Power backed down from a pro­pos­al to tack on fees for rooftop sol­ar cus­tom­ers amid pres­sure from con­sumer ad­voc­ates and sol­ar boost­ers. And in Idaho, the state pub­lic util­it­ies com­mis­sion re­jec­ted a sim­il­ar pro­pos­al.

Ari­zona bucked the trend when the Ari­zona Cor­por­a­tion Com­mis­sion de­cided that Ari­zona Pub­lic Ser­vice, the state’s largest util­ity com­pany, could hike rates for sol­ar cus­tom­ers.

It sounds like a win for the util­ity. But sol­ar groups say it’s not.

“In Ari­zona, APS got a lot less [in terms of the fee] then what they were ask­ing for,” Miller com­men­ted. “They wanted the fees to be some­where in the range of 50 to 100 dol­lars so the fi­nal rul­ing shows the polit­ic­al bound­ar­ies of the is­sue. And at the same time the com­mis­sion up­held net-meter­ing.”

Util­it­ies pro­viders, un­sur­pris­ingly, have a some­what dif­fer­ent per­spect­ive. 

“The com­mis­sion’s de­cision re­cog­nizes there is a cost shift oc­cur­ring where sol­ar users aren’t pay­ing what they should for use of the grid,” said Dav­id Owens, the ex­ec­ut­ive vice pres­id­ent of the Edis­on Elec­tric In­sti­tute, a trade as­so­ci­ation for U.S. in­vestor-owned elec­tric com­pan­ies.

Sol­ar groups gained more ground than they lost this year. But de­clar­a­tions of vic­tory by either side fail to cap­ture the whole pic­ture. 

“There is an un­fair char­ac­ter­iz­a­tion of util­it­ies versus sol­ar,” Owens said. “I’m not afraid of rooftop sol­ar. We see op­por­tun­it­ies there and we’re in­vest­ing in util­ity scale and oth­er sol­ar pro­jects. We’re not anti-sol­ar at all.”

What is clear is that head­ing in­to next year the ques­tion of sol­ar power pay­ment has not been re­solved.

State-level de­cisions im­pact­ing net-meter­ing and fees for sol­ar cus­tom­ers are be­gin­ing to look like just the start of a much lar­ger con­ver­sa­tion around re­work­ing util­ity pay­ment struc­tures in the age of dis­trib­uted gen­er­a­tion, an era whose hall­mark will be cus­tom­ers that cre­ate their own elec­tri­city without need­ing to rely on a cent­ral­ized power gen­er­at­or.

Both sides know the con­ver­sa­tion is com­ing, if it hasn’t already ar­rived.

“What we need to be talk­ing about is what’s the best way to al­loc­ate costs and how can we do this equit­ably and con­tin­ue to en­hance the grid,” Owens said. “What we’ve seen this year is a re­cog­ni­tion in vari­ous states that cur­rent rate-design struc­tures are not work­ing and they need to be re­vis­ited.”

For once, rooftop sol­ar ad­voc­ates don’t dis­agree. 

“I think we’re see­ing is that reg­u­lat­ors real­ize that you have to ad­dress these is­sues in the con­text of rate design,” Miller said. “The main thing is that when we look at rate design as a whole, sol­ar shouldn’t be made a tar­get.”

What We're Following See More »
WITH LIVE BLOGGING
Trump Deposition Video Is Online
16 hours ago
STAFF PICKS

The video of Donald Trump's deposition in his case against restaurateur Jeffrey Zakarian is now live. Slate's Jim Newell and Josh Voorhees are live-blogging it while they watch.

Source:
SOUND LEVEL AFFECTED
Debate Commission Admits Issues with Trump’s Mic
17 hours ago
THE LATEST

The Commission on Presidential Debates put out a statement today that gives credence to Donald Trump's claims that he had a bad microphone on Monday night. "Regarding the first debate, there were issues regarding Donald Trump's audio that affected the sound level in the debate hall," read the statement in its entirety.

Source:
TRUMP VS. CHEFS
Trump Deposition Video to Be Released
18 hours ago
THE LATEST

"A video of Donald Trump testifying under oath about his provocative rhetoric about Mexicans and other Latinos is set to go public" as soon as today. "Trump gave the testimony in June at a law office in Washington in connection with one of two lawsuits he filed last year after prominent chefs reacted to the controversy over his remarks by pulling out of plans to open restaurants at his new D.C. hotel. D.C. Superior Court Judge Brian Holeman said in an order issued Thursday evening that fears the testimony might show up in campaign commercials were no basis to keep the public from seeing the video."

Source:
A CANDIDATE TO BE ‘PROUD’ OF
Chicago Tribune Endorses Gary Johnson
21 hours ago
THE LATEST

No matter that his recall of foreign leaders leaves something to be desired, Gary Johnson is the choice of the Chicago Tribune's editorial board. The editors argue that Donald Trump couldn't do the job of president, while hitting Hillary Clinton for "her intent to greatly increase federal spending and taxation, and serious questions about honesty and trust." Which leaves them with Johnson. "Every American who casts a vote for him is standing for principles," they write, "and can be proud of that vote. Yes, proud of a candidate in 2016."

NEVER TRUMP
USA Today Weighs in on Presidential Race for First Time Ever
1 days ago
THE DETAILS

"By all means vote, just not for Donald Trump." That's the message from USA Today editors, who are making the first recommendation on a presidential race in the paper's 34-year history. It's not exactly an endorsement; they make clear that the editorial board "does not have a consensus for a Clinton endorsement." But they state flatly that Donald Trump is, by "unanimous consensus of the editorial board, unfit for the presidency."

Source:
×