SolarCity disclosed earlier this month that it is a financial backer of the Checks and Balances Project, a clean energy “watchdog” group that has launched several campaigns against utility regulators, seeking to expose bias against the solar industry.
Will Craven, a SolarCity spokesperson, told Arizona’s Yellow Sheet Report on December 8 that his company has provided “general support” for Renew American Prosperity, which is the primary funder of Checks and Balances. Renew American Prosperity is a 501(c)(4) nonprofit, and is not required to disclose its funders.
“Though we’ve had no input on how our support for Renew American was used, we support Checks and Balances’ mission to hold regulators accountable,” Craven said in an emailed statement to GTM.
In Arizona, the group launched an extensive investigation into Commissioner Bob Stump’s phone records, alleging his involvement in “dark money electoral schemes” and inappropriate ties with Arizona Public Service (APS), the largest utility in the state.
A judge is currently reviewing thousands of text messages retrieved from Stump’s cell phone. Meanwhile, the group’s work prompted a lawsuit that led to the recent resignation of Susan Bitter Smith, chairwoman of the Arizona Corporation Commission (ACC).
The revelation of SolarCity’s support for Checks and Balances came days after the company cut ties with The Alliance or Solar Choice (TASC), a 12-member lobby group spearheaded by Sunrun.
While the two major solar installers align on several key policy issues, recent events seem to signal a strategic divide in the solar industry’s advocacy efforts, which comes as state-level solar policy debates are expected to intensify through 2016.
Support for dark-money groups
Checks and Balances took a particular interest in Arizona after regulators in the state approved a roughly $5 monthly fee on rooftop solar customers in 2013, becoming one of the first states to challenge net energy metering -- a policy that requires utilities to compensate solar customers for excess energy they send back to the grid at the retail electricity rate. The fee reduces customers' overall savings.
Both utilities and solar advocates have been actively trying to sway public opinion in the solar policy debate. In 2013, APS admitted to backing anti-rooftop-solar groups -- 60 Plus and Prosper HQ -- that launched aggressive public relations campaigns to turn ratepayers against net energy metering.
TASC, which included SolarCity at the time, and the conservative pro-solar group Tell Utilities Solar Won’t Be Killed (TUSK) launched their own advertising campaigns in response.
Utility spending on the 2013 net metering debate far outweighed the solar industry’s. Pinnacle West Capital Corp., which owns APS, disclosed that it spent $3.7 million on advertising and other communication efforts, while the solar industry spent about $436,000.
Because of TASC’s role in the policy debate in Arizona, there was widespread speculation that Sunrun was also a backer of Checks and Balances. But on December 1, Sunrun Senior Vice President of Public Policy Bryan Miller filed an affidavit stating that his company had no involvement with the group. News of SolarCity’s support came a few days later.
“Pro-utility organizations have outspent the solar industry 8 to 1,” said Craven. “We owe it to the people of Arizona to help ensure that important decisions about their right to go solar are made in the light of day, and it’s unfortunate that Pinnacle West and APS have not been truthful about their funding of anti-solar organizations.”
Miller condemned the use of all dark-money groups.
“Sunrun has long complained about APS’ use of dark money to hide the fact that APS has been trying to buy elections and manipulate commissioners in Arizona for years. And we think the same [transparency] standards apply to everyone in advocacy,” he said in an interview.
Craven said that SolarCity has been transparent about its political activity. The company had just never been asked about its support for Checks and Balances until this month.
Criticism from Commissioner Stump
Commissioner Stump said it was hypocritical for SolarCity to condemn APS’ dark-money spending, while admitting to funding its own dark-money groups.
“SolarCity representatives are operating on this idea: We'll deplore secrecy and keep our involvement secret until it won't be, then we'll deplore others' secrecy and applaud our non-secrecy,” he wrote in an email.
Stump criticized Checks and Balances for its targeted and aggressive smear tactics. The group’s investigations serve no purpose other than trying to intimidate regulators as they take up solar policy issues, he said.
“Can you imagine the outcry if a utility funded a dark-money group to sue and harass sitting regulators?” he said.
Stump told The Arizona Republic that he suspects SolarCity may have disclosed its spending to try and prevent him from participating in votes on solar issues, such as APS’ upcoming rate case. Arguably, Stump’s knowledge of SolarCity’s involvement in the public record investigation could bias his decision-making. Stump insisted he could remain impartial.
Scott Peterson, executive director of Checks and Balances, stressed that his organization is not trying to humiliate or shame public figures. “We simply use tools to ask questions of people who don’t normally get questions asked,” he said.
The group represents a broad array of interests across the environmental and clean energy space, said Peterson. And while donors have the legal ability to remain secret, Checks and Balances’ website clearly states that the group is funded by “pro-clean energy philanthropies and donors.”
“SolarCity is only one of our funders,” Peterson said, “so I would not make too much of their overall role.”
Varying advocacy strategies
Checks and Balances was launched at the United Nations climate talks in 2009 with the mission to counteract the tidal wave of money the fossil fuel industry spends to undermine the growth of clean energy, and to do that through public-record requests in light of the decline in investigative journalism.
In 2010, the group investigated the conduct of fracking regulators and continues to probe the industry ties of mainstream college professors. In February, Checks and Balances launched the “Captured Regulators” initiative, which seeks to expose inappropriate ties between utility commissioners and the utilities they oversee.
The group has never taken a position on a candidate or legislation or advocated for any particular initiative, said Peterson. This sets Checks and Balances apart from TASC and other advocacy groups that are directly involved in the policy process.
“We believe we fill a niche,” said Peterson. “We ask questions of government officials, lobbyists and corporate managers who stand in the way of growth of clean energy.”
TASC has never worked with Peterson’s group, but its members have launched similar campaigns. Sunrun is currently suing Nevada Governor Brian Sandoval for failing to comply with a public-records request showing communication between his office, utility regulators and NV Energy. The solar company claims that Sandoval’s close ties with the utility industry led to the recent repeal of retail-rate net metering in the state.
The difference between TASC and Checks and Balances is that TASC has done everything in the name of its members, said Sunrun’s Miller.
TASC also frequently intervenes in regulatory dockets, organizes grassroots campaigns and stages publicity stunts, like flying a plane over NV Energy’s headquarters with a sign that read “Don’t Kill Solar.” Miller said he’s proud of TASC’s work.
“The reason the rhetoric is so strong is because the consequences are immense and the utility tactics are extreme,” he said.
Splintering the solar industry?
TASC has taken an uncompromising position on preserving retail rate net metering in solar rate proceedings across the country. A recent Utility Dive article questioned whether TASC’s fierce lobbying efforts were splintering the solar industry.
Former Hawaii PUC Chair Mina Morita recently wrote that TASC is doing the renewable energy industry a disservice. Achieving a high penetration of affordable renewable energy “will not come from a political decision based on push polls rooted in negative campaigning which [Bryan] Miller seems to rely on,” she wrote.
Some local solar installers in have distanced themselves from TASC. In Arizona, local installers have opted to build out utility-owned rooftop solar projects rather than oppose them.
Still, Miller rejected the argument that TASC is hurting the solar industry. The group has led the industry to win more than 50 verdicts over the past three years, according to Miller. The criticism, he said, comes from outside of solar sector.
There was some speculation that SolarCity left TASC because of the group’s aggressive tactics. But Craven denied any disagreement between the two. He said SolarCity would be backing the new group Energy Freedom Coalition of America (EFCA) simply to seek representation on a broader range of clean energy interests rather than focusing solely on rooftop solar.
EFCA has already started to get more involved solar issues. For instance, the coalition is supporting NC WARN in a campaign to change North Carolina’s restrictions on third-party ownership. Craven said it’s up to TASC members to decide whether or not they want to intervene.
What comes after the ITC extension?
The timing of SolarCity’s departure from TASC and disclosure of support for Renew American Prosperity, the primary backer of Checks and Balances, is notable. If nothing else, it shows that solar industry players are shifting where they direct advocacy dollars heading into the new year. It also shows that companies support an array of organizations with varying levels of transparency and slightly different missions.
At this point, it’s unclear which initiatives will ultimately do the best job of fostering the sustainable expansion of distributed energy resources.
A look at industry advocacy efforts is relevant in light of the recent extension of the Investment Tax Credit. With federal policy locked in for the next five years, renewable energy advocates are likely to move more of their resources to the state level, where there are dozens of ongoing proceedings to address the value of distributed solar.
The recent decision to roll back retail rate net metering in Nevada, for instance, raises questions around how the industry as a whole will respond to such developments.
Debates between utilities and solar advocates are only likely to intensify as more renewables come on the grid and challenge the traditional electricity business model. The tactics solar companies choose to employ in those debates will have a significant impact on the overall electricity landscape.