In new net-metering limits, solar advocates see a threat to growthMay 5 - McClatchy-Tribune Content Agency, LLC - Daniel Moore Pittsburgh Post-Gazette
Advocates of solar energy have expressed concern over new limits proposed by the Public Utility Commission on "customer generators" -- most often electricity-producing solar panels -- that can produce electricity in excess of what is consumed. For excess power generated, utilities credit customers at the retail rate on their next monthly bill. At the end of the year, utilities will reimburse any extra generation accumulated throughout the year at the wholesale rate. Called net metering, that practice could become more complicated after the commission last month suggested capping such systems at 200 percent of a customer's annual electricity consumption. This was an update to its initial proposed cap of 110 percent of usage introduced in February 2014. While the state already has a limit on capacity -- residential generators can't exceed 50 kilowatts, and commercial generators are capped at 3 megawatts -- placing a cap based on their usage is seen by solar advocates as confusing, unnecessary and constraining growth. "At the end of the day, yeah, sure, these changes are a marginal improvement to what was proposed last February," said Evan Endres, solar manager at Citizens for Pennsylvania's Future, or PennFuture, an environmental advocacy group. "The bigger question is: Is this necessary? We have that hard 50-kilowatt cap. ... What problem are you solving?" The proposal comes as the central change sought by the PUC as part of a host of revisions to the state's Alternative Energy Portfolio Standards Act, passed in 2004 to require utilities to buy increasing amounts of electricity generated from alternative and renewable resources. That law also outlined the PUC's authority to regulate net-metering, which allows customers who generate their own power to receive full retail credit for any excess electricity sent back to the grid. Net-metering policy has become a point of contention between proponents of renewable energy and utilities, whose traditional business model of producing electricity and delivering it to customers could be upended if customers begin producing enough power to no longer need delivery. A national survey of utility executives this year found 88 percent see distributed energy resources -- an all-encompassing term for solar, wind and other small-scale generators distributed among homes and business -- as an opportunity for growth. But 63 percent of those same respondents were unsure of how to build a successful business around it, according to UtilityDive, a provider of industry news and analysis that published the findings. In a statement after voting to seek public comment on the change to the proposed limit, Commissioner James Cawley echoed the industry's concern. While allowing larger systems could encourage more solar customers, he wondered if it would be fair and sustainable in the long run. As more power flows into the grid from customers, it could "crowd out" future customer generators from the local distribution grid and force utilities to invest more money to accommodate that additional power. It's possible, he added, utilities could be faced with the option of either denying new net-metering applications or passing through their costs through interconnection fees. PennFuture, which after the initial proposal last February formed a coalition of solar organizations to oppose the limits, said in comments to the PUC last year that usage limits would deter new customers and "only adds additional uncertainty and regulatory cost, which is ultimately paid by all ratepayers." In an interview last week, Mr. Endres said a 200 percent cap would not "destroy the industry, but what it will do is slow down production" because it stifles future growth. He provided an example: A homeowner may want to install a 3-kilowatt system, which produces about 3,500 kilowatt-hours of electricity toward the home's annual consumption of 4,000 kilowatt-hours per year -- about 90 percent of expected usage. But if those same homeowners wanted to buy electric vehicles or build additions onto their home, they might want to oversize their system to produce 8,500 kilowatt-hours per year, which would exceed the 200 percent limit. "These proposed rules would eliminate their right to plan ahead, and the associated cost savings to make that decision," Mr. Endres said. Ron Celentano, president of the Pennsylvania Solar Energy Industries Association, said increasing the cap from what was originally proposed is "going in the right direction" and "within some level of reason." But he declined to comment further until he could gather more impressions from the state's solar industry. Sharon Pillar, president of Solar United Network of Western Pennsylvania, a coalition of solar professionals and advocates in this region, said the limits seem arbitrary and that no data exists to prove they are necessary. It would likely also be an added burden, she said, for a potential solar customer to prove historical usage. As currently written, the PUC would allow customers to submit electric usage data for any consecutive 12-month period within the prior 60 months. "It's really about additional restrictions that we feel are going to overburden our homes and small businesses," Ms. Pillar said. "It's an unnecessary hurdle they'll have to go through." Mr. Endres said distributed generation is years away from competing with utilities, as Mr. Cawley suggested, and crowding the grid, a phenomenon known as "islanding." "We don't need to slow down progress now for a guess at what could be a problem in the future," he said. "To clamp down on growth prematurely, I think, is unfair to the industry and unfair to ratepayers." He added, "By the time it becomes an issue, we could have a solution to that problem." Once publicly posted in the Pennsylvania Bulletin, the proposed changes will open for 20 days of public comment. Daniel Moore: dmoore@post-gazette.com, 412-263-2743 and Twitter @PGdanielmoore. http://www.energycentral.com/functional/news/news_detail.cfm?did=36062410 |