It isn’t officially autumn until September 23, but summer pretty much feels like it’s over. When it comes to energy news, it feels like summer was hardly here at all.
The White House certainly didn’t slow down, announcing the final version of the Clean Power Plan rule on August 3. President Obama then traveled to Nevada, where he unveiled a plan to accelerate the use of PACE loans and announced $1 billion in new loan authority available for clean-energy projects.
Congress took a summer recess, but returned to the Capitol Building after Labor Day with a full slate of energy legislation to consider. Among the items is a tax extenders bill with language to extend the wind Production Tax Credit that's now pending a full Senate vote. Also, both the House and Senate are considering bipartisan pieces of energy legislation that address everything from the electrical grid to pipelines, energy efficiency to hydropower.
At the state level, solar continues to be a hot policy topic. Florida in particular is seeing increased activity around two competing solar ballot initiatives, where the divide between utilities and distributed solar advocates has proven to be more prominent than political differences.
A brewing debate over whether or not to allow for third-party solar financing in Florida has intensified in recent weeks.
On September 1, the Florida Supreme Court heard arguments for and against the language of a 2016 ballot initiative to open up the state’s solar market. Floridians for Solar Choice, a free-market group spearheading the initiative, argues that the constitutional amendment is necessary to allow more consumer choice when it comes to buying and selling energy in the Sunshine State. Florida is currently one of only four states where laws expressly prohibit citizens and businesses from buying solar power directly from an entity other than an electric utility.
A wide range of stakeholders from more than 50 organizations has come out in support the ballot initiative. The coalition has collected more than 225,000 petition signatures to date; nearly 140,000 have been verified by Florida’s Division of Elections.
Opponents have put forward a rival ballot being championed by Consumers for Smart Solar, a group supported by Florida’s electric utilities, as well as the Florida Hispanic Chamber of Commerce, the National Black Chamber of Commerce, and the 60 Plus Association. Several of these groups have ties to the Koch brothers, according to a funding investigation by the Energy and Policy Institute.
“We’re interested in how utilities are funding efforts to stop the adoption of rooftop solar,” said Gabe Elsner, executive director of E&PI. “This Florida case is a perfect example where there is an effort to increase the ability for homeowners and businesses to install solar, and sure enough, the utilities are against it, going far enough to create an alternative ballot that does essentially nothing but confuse the issue for voters.”
On Sept. 10, Consumers for Smart Solar announced it had collected 100,000 signatures, enough to trigger a review by Florida’s Attorney General and the Florida Supreme Court. The group says its proposed amendment would allow consumers to own and lease solar, while also ensuring that everyone who uses the grid pays for it and that out-of-state solar utilities are not constitutionally immune from state and local consumer protection laws.
Both camps have released polls showing support for their respective amendments. The initiatives will each need a total of 683,149 signatures by February 1, 2016 in order for their amendments to be considered in the November election.
In other news, Florida Power & Light has filed a request with the Florida Public Service Commission to reduce electricity rates in 2016. The proposal will save a typical 1,000-kilowatt-hour residential customer about $2.50 a month on average next year, compared to 2015 rates. Separately, the Canadian power producer Emera Inc. announced it’s making a big bet on the U.S. power market with plans to buy Florida generator Teco Energy Inc. for $6.5 billion.
Later this week, lawmakers in North Carolina will vote on a state budget that does not extend the state’s 35 percent tax credit for solar and other clean technologies, to the disappointment many supporters of the measure. The credit is now set to end on December 31. A bill that would have frozen the North Carolina’s renewable portfolio standard at 6 percent, instead of progressing to 12.5 percent by 2021, hasn’t seen any action in four months.
Meanwhile, solar deployments continue to grow in the state. Duke Energy recently announced it is on track to more than double its North Carolina solar portfolio this year, with 160 megawatts of new solar projects in 2015.
Sunrun launched a lease product in South Carolina on Sept. 9, adding to the company’s purchase and loan options introduced in June. South Carolina's Office of the Regulatory Staff began accepting applications from solar leasing companies in August, stemming from the Distributed Energy Resource Program Act (A236) signed into law last year.
In carrying out Act 236, the state PSC approved solar incentive programs from South Carolina’s investor-owned utilities, Duke Energy and South Carolina Gas & Electric, this spring. The law also requires regulatory staff to issue a report on cost-shifting associated with distributed energy by the end of the year. Public comments are currently being accepted through Sept. 15.
On Sept. 1, the Alabama Public Service Commission approved Alabama Power’s request to build 500 megawatts of renewable energy capacity. The utility said the decision will help Alabama Power meet the demands of large customers, primarily Fortune 500 companies and military facilities with renewable energy mandates. These customers would pay a premium for the power, so that costs are not transferred to the broader rate base.
The commission made several changes to the original proposal, including a biennial competitive bidding process for projects, the approval of no more than 160 megawatts of projects per year, and a PSC vote on whether or not to approve each project. Alabama Power had no objections to the changes. Clean-energy advocates were also supportive of the outcome, including the Solar Energy Industries Association, which noted that there are just 2 megawatts of solar installed in Alabama today.
“Our neighboring states may have a head start in realizing the environmental and economic benefits of renewable energy, but Alabama can use this opportunity to catch up and spur growth in this booming marketplace,” said Keith Johnston of the Southern Environmental Law Center.
On Sept. 2, Governor Terry McAuliffe launched a $20 million loan program to lower financing costs for energy efficiency, renewable energy generation, and alternative fuel projects. According to a recent report, Virginia currently ranks 30th in solar power deployments.
In a major turn of events, the D.C. Public Service Commission denied Exelon’s $6.8 billion takeover of Pepco Holdings on Aug. 25. A strong grassroots movement helped to thwart the deal, but Exelon and Pepco have vowed the battle isn’t over yet. The utilities have 30 days from the ruling to appeal the decision. Five states have already approved the merger.
Lawmakers in California passed a bill last Friday targeting a 50 percent renewables energy mix by 2030, and a 50 percent increase in building energy efficiency by the same year. Controversial language that would have required a 50 percent reduction in oil use in the state was ultimately struck from the legislation.
The legislature also passed a bill to divest from coal (SB 185), as well as a resolution in support of extending the federal tax credit for solar energy systems; SJR 10 calls on Congress to extend the 30 percent tax credit for residential and commercial solar projects.
In utility news, the CPUC announced on Aug. 28 that it has launched a formal investigation to determine whether PG&E’s “organizational culture and governance prioritize safety and adequately direct resources to promote accountability and achieve safety goals and standards.” The investigation stems from a fatal 2010 pipeline explosion. The CPUC also issued a citation to PG&E for $50,000 for the utility’s failure to safely maintain its Metcalf Substation in San Jose, which was burglarized the night of Aug 26. Meanwhile, regulators have required SCE to investigate the cause of several recent outages.
NV Energy has filed a proposal with the state PUC to launch a community solar subscription program, the Reno Gazette-Journal reports. The energy will come from two 5-megawatt solar farms and will be available to consumers in 100-kilowatt blocks. Customers will have to pay a premium for the power, but in return will get to go solar without signing a long-term contract or paying for anything upfront.
The proposal comes shortly after the PUC voted to extend the state's existing solar net-metering policy through the end of year, as the commission debates the future of the program. A week earlier, NV Energy announced the state had hit its 235-megawatt net metering cap, which sparked a backlash from solar advocates. Vivint Solar suspended operations in the state a few weeks prior to the decision amid the policy uncertainty.
NV Energy filed an alternative solar policy with the PUC in August that would have reduced the value of net metering credits and added new fees on solar customers. The interim rate is not what the utility proposed, but that could change in 2016. The Nevada PUC is required to decide on a permanent net-metering structure by December 31.
As the value of solar debate played out in the Nevada PUC last month, it also played out on stage in a debate at Sen. Harry Reid’s National Clean Energy Summit. In addition to rolling out new energy incentives, President Obama criticized lobbying efforts from the Koch brothers and others in his keynote address at the event, accusing them of “standing in the way of the future.”
In late August, the Arizona Corporation Commission approved a motion from Tucson Electric to hold off on any changes to solar net metering until the utility’s 2016 rate case. The move came in sharp contrast to a decision made two days earlier, in which the ACC said it would start hearings this year on a proposal to raise fees on solar customers from Arizona Public Service. APS is seeking to increase its solar fee from roughly $5 per month to $21 per month.
Commissioner Doug Little, who was elected last year, said that holding hearings on the APS fee increase request does not guarantee it will be approved, The Arizona Republic reports. Little also filed an amendment to study whether or not there is a cost shift from solar to non-solar customers.
Meanwhile, the attorney general’s office is investigating allegations of overly friendly ties between ACC commissioners Bob Stump and Gary Pierce and APS. On Sept. 2, a separate complaint was filed against ACC Chairwoman Susan Bitter Smith for her previous work as a lobbyist. Amid the controversy, the solar advocacy group The Alliance for Solar Choice has committed to staying out of the ACC’s 2016 elections, and has invited utilities to do the same.
On Sept. 14, New Mexico Gov. Susana Martinez unveiled an “all-of-the-above” energy policy designed to support the development of oil, natural gas and coal, as well as low-carbon energy resources. The plan includes reducing soft costs for renewable projects through improved permitting, pursuing energy storage development, and possibly raising New Mexico’s renewable portfolio standard.
Separately, the Santa Fe-based group New Energy Economy filed a motion with the New Mexico Public Regulation Commission in early September, seeking to prevent four of the five commissioners from making decisions related to one of the state’s coal-fired power plants. The group has accused the commissioners of having close ties with utility executives based on 100 pages of text messages and emails. The first hearing on the Public Service Co. of New Mexico-owned coal plant is scheduled for Oct. 13.
After his appearance in Nevada, President Obama made his way north to Alaska where he called for urgent action to address climate change. The Obama administration said it plans to launch a $4 million renewable energy initiative for remote Alaskan communities. Shortly before the president’s trip, the federal government gave Royal Dutch Shell final approval to drill for oil in the Arctic Ocean off Alaska's northwest coast.
Washington state recently passed a $40 million extension to the state’s Clean Energy Fund. As part of the implementation process, the Department of Commerce will soon convene two advisory panels, one for electric utilities and one for clean-energy research and development. The panels are expected to hold public meetings through September to determine how to distribute the funds.
On Aug. 26, the Colorado PUC voted to uphold net metering in its current form, despite calls for change from the state's largest electric utility, Xcel Energy. Separately, Colorado Attorney General Cynthia Coffman announced her state will join a multi-state suit against the Clean Power Plan.
NextEra Energy recently offered to make 50 new commitments to Hawaiian electricity customers as part of the Florida-based company’s $4.3 billion proposal to buy out Hawaiian Electric Industries. Promises include a commitment to Hawaii’s 100 percent renewable energy target, new spending on smart grid technology, and nearly $1 billion in customer savings.
In July, Hawaii Gov. David Ige told the Honolulu Star-Advertiser that he opposes the acquisition, and is recommending that the PUC reject it. More than 40 state and county leaders have come together to explore whether a public utility ownership option is a viable alternative.
While opposition is strong, the two utilities are taking steps to move the merger forward. The commission will hold several public meetings on all islands over the next two months. A final decision is expected by June 2016.
On August 31, the Ohio PUC held its first hearing on FirstEnergy’s rate case that would require customers at the holding company’s three distribution utilities -- Ohio Edison, Cleveland Electric Illuminating, and Toledo Edison -- to purchase power from two of its struggling power plants for the next 15 years.
FirstEnergy claims the two plants -- a large, old coal plant in Stratton, Ohio and a large, old nuclear plant on Lake Erie -- need to stay open to maintain grid reliability and energy affordability. The company has admitted that electricity costs may rise in the near term, but estimates the deal will save ratepayers $2 billion over the 15-year period.
However, according to the Ohio Consumers' Counsel, the deal would cost ratepayers $3 billion over the lifetime of the agreement. FirstEnergy’s consultant also admitted at the hearing that future wholesale energy costs were overestimated in the utility’s forecast, undercutting the credibility of the utility’s plan.
In addition to costs, there are concerns about PUC oversight. Environmental groups and competitive energy providers Dynegy and AEP are also opposed to the FirstEnergy deal. Earlier in the year, PUCO rejected similar “bailout” proposals from Duke and AEP.
As hearings on the FirstEnergy proposal continue through fall, Ohioans will also debate the future of the state's stalled renewable portfolio standard. Legislation passed last year put a two-year freeze on the RPS. Ohio’s Energy Mandates Study Committee now has until September 30 to decide how the state should proceed.
A broad coalition of state business, health, community and environmental groups has come out in support of lifting the freeze. Advocates say lifting the RPS will help Ohio comply with the Clean Power Plan. Many lawmakers are against the RPS, however. Meanwhile, Ohio is already in litigation challenging the new federal rules.
Michigan officials recently announced they plan to develop their own compliance strategy for the EPA’s Clean Power Plan, as opposed to letting the federal government devise a plan for the state. The decision has received support from a broad group of energy stakeholders.
The final EPA rule gives states until 2018 to file their carbon reduction plans, and until 2022 to begin making emissions cuts. Michigan will need all of the time allotted in order to comply, said Valerie Brader, executive director of the Michigan Agency for Energy, on a recent call with reporters. “We’re not filing anything early,” she said.
Republican Gov. Rick Snyder’s administration is preparing to comply with the rule in part by raising Michigan’s 10 percent renewable energy target through voluntary measures. Meanwhile, Attorney General Bill Schuette has joined a lawsuit trying to block the federal plan. Brader said that Schuette is acting alone, and that the governor’s office does not plan to join the challenge.
Work also continues in the Michigan state legislature, where a bipartisan group of lawmakers recently introduced a package of bills, dubbed the “Energy Freedom bills,” to lift the cap on the state’s net metering program and allow consumers to buy shares of a community renewable energy project.
Another set of bills in the package would establish fair value pricing, which “ensures that homeowners and businesses get paid what utility companies would pay themselves for producing renewable energy,” according to the bill sponsors. Under the bill, the Michigan Public Service Commission would come up with a methodology that “accounts for the value of the renewable energy, its delivery, generation capacity, transmission capacity, transmission and distribution line losses, environmental value, and other values that are not always considered in current energy prices.”
The Energy Freedom legislation comes in response to a separate bill (SB 0438) that would eliminate net metering in Michigan. The proposal has received support from utilities and several Republicans, but is opposed by solar customers and Tea Party member Rep. Gary Glenn, who is a sponsor of the Energy Freedom bills.
The Wisconsin PSC will hold public hearings Sept. 16 and Oct. 29 on Xcel Energy’s request to increase electric revenues by 3.9 percent and natural gas by 5 percent. The utility has proposed to lower the cost of electricity, while more than doubling the flat monthly service fee on about 255,000 non-industrial customers.
Meanwhile, the renewables industry is far less than thrilled with Governor Scott Walker’s record on wind and solar, which has put the state well behind its neighbors on clean energy deployments, Bloomberg reports. Walker, a Republican presidential hopeful, also opposes the Clean Power Plan. Sen. Ron Johnson opposes the CPP, too. The League of Conservation Voters and EDF Action launched a $1.6 million ad campaign in Wisconsin on Sept. 1 to urge Sen. Johnson to end his opposition to the CPP, with the U.S. Senate expected to consider votes on the EPA’s plan this month.
Exelon’s nuclear fleet in Illinois has cleared PJM’s most recent capacity auction, throwing a lifeline to the utility’s troubled Quad Cities and Byron plants, the Quad-City Business Journal reports. The decision allows the nuclear plants to sell power into the wholesale power market until 2017. Exelon has said it will need to keep all of its Illinois nuclear plants in operation in order to comply with the EPA’s new carbon regulations, and is pushing for a "low-carbon portfolio standard" in the state.
In late August, Pella Cooperative Electric withdrew plans to impose an additional $57.50 monthly fee on solar customers, which would have resulted in one of the highest fixed rates in the country. Pella sent a letter to its 3,000 members in June notifying them that the fixed rate increase would apply to anyone who installed solar after Aug. 15. The co-op eventually backed down under pressure.
The Kansas Corporation Commission gave Westar Energy the green light for a $78 million rate increase on nearly 700,000 customers, which is half of what the utility initially sought. Regulators also postponed consideration of a special charge on solar customers, but plan to address it in a future hearing. In the meantime, potential solar customers have been put on notice that the rules could change. National solar installers have been barred from intervening in the solar policy docket.
In response to a factory closure, Governor Paul LePage sent a letter to Maine’s legislative leaders in late August calling on them to reform the state’s “obsolete and costly energy policies.” LePage put forward three pieces of legislation last session that he criticized lawmakers for not passing, including a bill (LD 1987) that would have eliminated both the state’s renewable portfolio standard and net metering program. That bill passed in the Senate, but died in the House in June. The state legislature ultimately passed a bill (LD 1263) that sets the stage to replace the current net energy metering policy with an innovative alternative.
SolarCity has expanded its New Hampshire presence with a new operations center in Manchester. Gov. Maggie Hassan attended the opening on Sept. 9. The center is SolarCity's first in the state, after launching a New Hampshire service in April.
The expansion has renewed questions about the future of New Hampshire’s renewable energy incentives. Liberty Utilities hit its net metering cap in July, and other utilities are approaching their limits. At the SolarCity opening, Gov. Hassan said her office will “take a look at that issue.” Meanwhile, the PUC has put all renewable energy rebates on hold after the state’s renewable energy fund brought in less revenue than expected. The programs are expected to reopen, albeit with decreased incentives, once the PUC sets a 2016 budget.
Policymakers in Massachusetts are grappling with how to develop a sustainable solar policy with the state’s net-metering cap fast approaching. National Grid already hit its cap in March, generally making solar projects less economical.
The Democratic-led state senate passed a bill before the summer recess in July to lift the net metering cap until Massachusetts reaches its target of 1,600 megawatts of installed solar. In August, Gov. Charlie Baker introduced a separate bill that would raise the cap for all solar projects in the interim, and eventually reduce compensation for large municipal projects. A robust debate is expected in the legislature, now that lawmakers have returned.
Also in August, Massachusetts utilities Eversource Energy, National Grid and Unitil filed grid modernization plans to reduce energy costs, boost resiliency and improve the integration of distributed resources, EnergyBiz reports.
Unitil plans to spend $12 million to become more of an “enabling platform.” Eversource has proposed a $430.7 million, five-year plan with four main components: grid-wide situational awareness, advanced analytics, real-time flexibility and distributed generation integration. National Grid presented four options that range from $225.3 million over five years, up to $1.3 billion over 10 years. All three utilities will offer optional time-of-use rates for customers.
Stakeholders in New York continued to work on the Reforming the Energy Vision proceeding through the summer. On August 18, the Market Design and Platform Technology Working Groups filed their final report with the New York State Department of Public Service as staff develop guidance for New York utility Distributed System Implementation Plans.
Also under the REV umbrella, NYSERDA announced Donovan Gordon will lead efforts to expand renewable heating and cooling markets in New York, and Gov. Cuomo has announced the state’s first large-scale anaerobic digester project on Long Island.
Governor Chris Christie has filed a letter with the EPA seeking a stay of implementation and reconsideration of the Clean Power Plan, calling it “unlawful” and “fundamentally flawed.” Christie’s office said New Jersey is the first “clean energy” state to file an objection to the rule.
Action against the CPP comes shortly after Christie upheld a law to expand New Jersey’s net metering caps, and as state leaders work to update New Jersey’s 2011 Energy Master Plan. Several stakeholders pushed for a higher renewable energy targets at a public hearing on Aug. 17.
Separately, the Bureau of Land Management has confirmed it will host an offshore wind auction this fall for sites off the coast of New Jersey. The 344,000 acres available for leasing could support up to 3.4 gigawatts of commercial wind generation.