Solar Tariffs Under Threat All Over The US

A recent article at Solar Power World warns us about a threat to clean energy that’s proliferating around the United States. In articles like this one, we’ve covered the story of several states messing with net metering, and how it would harm the adoption of rooftop solar.

Net metering helps solar customers by crediting them for the extra electricity their panels produce, and it’s one of the key reasons why solar has been able to grow so rapidly in the last few years. But now, utilities are starting to put up a fight against net metering, claiming that it’s unfair to non-solar customers. And in a growing number of cases, they’re winning.

According to the news source, as of early 2022, 29 states have state-mandated net-metering programs that provide full retail value net-metering to their clients, meaning that they get back dollar-for-dollar what they put back into the grid at the same price they pay for electricity that comes from the grid. Many of these states, however, are currently working on or already planning to modify their rules on this in tricky ways. With a variety of small changes, full retail net-metering is becoming increasingly rare.

In the Carolinas, the trick they’re pulling is to apply “time of use” rates to net metering, effectively giving people lower than retail rates whenever the sun is up, or during the times that solar panels would produce the most. This effectively ends net metering, because nobody with rooftop solar is going to put energy into the grid at night.

A particularly bad attack on net metering was thwarted in Florida when Governor Ron DeSantis vetoed a really nasty bill that would have really hurt if the bill had been signed into law, by requiring excess generation to be valued at the utility’s avoided-cost rate of 2-4¢/kWh by 2029, following a pre-determined reduction schedule until then. Solar advocates said it would have crushed the fledgling rooftop solar market in Florida.

There were a couple of other surprises. In Kentucky, a state with only minimal rooftop solar installations, legislators tried to end net metering. There was also an effort in California that tried to give net metering the ax, but that failed.

Although the types of changes being discussed continue to vary, there is a unifying theme: they endanger the value of solar. The bill arrangements may take various forms, including declining export rates and establishing fixed charges and bill minimums, as well as disallowing carry-forward of credits into future months or simply setting credits to zero at the end of a true-up period. Many of today’s NEM successor tariffs are eroding solar’s value excessively, making stand-alone PV projects less appealing in terms of economics.

The good news? These rules do encourage people with solar, or those considering getting home solar, to also get energy storage. By keeping their own solar power that they generated during the day, they can avoid buying power at retail rates from the local utility on most days, effectively selling the power back to themselves at night for full retail price. This is obviously more expensive than solar without storage, but by cutting out the grid, customers can remain mostly unaffected by attacks on net metering.

Featured image by Vijay Govindan, CleanTechnica.


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