Net metering, typically an issue for state regulators, has officially made it to the national level.
U.S. Senate Minority Leader Harry Reid (D-Nevada) and Senator Angus King (I-Maine) have filed an amendment to a broad energy bill, the Energy Policy Modernization Act (S.2012), to prevent state regulators from retroactively changing net-metering arrangements. The amendment also requires that state regulators account for the benefits of distributed solar in any valuation of a net metering policy.
Meanwhile, Senator Jeff Flake (R-Arizona) has introduced a rival amendment that requires regulators to examine whether new policies result in cost shifts between customer groups.
So far, lawmakers have been quick to throw out controversial amendments in order to move the energy bill forward. But given how controversial net metering has been at the state level -- with Nevada and California making news in January -- either of these amendments could potentially gain traction.
Updates on a range of state-level developments below. Click on a region to jump to news from the South, West, Northeast, or Midwest. You can read our previous state bulletin here.
A utility-supported solar amendment in Florida, led by the group Consumers for Smart Solar (CSS), has received enough validated signatures to qualify for the 2016 ballot. CSS was formed in response to Floridians for Solar Choice (FSC), a group seeking to legalize third-party-owned solar in the state through a separate ballot initiative. The CSS amendment would confirm customers’ constitutional right to “own or lease solar,” but would not legalize third-party ownership. FSC, which did not collect enough signatures in time to qualify for the 2016 ballot, says the utility-backed initiative is misleading.
“It doesn’t have anything to do with consumers’ energy choices; it merely enshrines current law into the constitution,” said Bill Garner, one of FSC’s attorneys, according to Florida Politics. “The amendment would change nothing.”
FSC has filed briefs challenging the CSS initiative with the Florida Supreme Court. The pro-solar coalition is also examining options to qualify for the 2018 ballot.
Regulators in Mississippi have rejected requests for a rehearing on the state’s net metering policy approved in December, the Mississippi Business Journal reports. Four petitions for reconsideration were filed, including from the Electric Power Associations of Mississippi Inc., which represents 11 rural electric cooperatives. To continue the challenge, petitioners will have to take the issue to court.
Three utilities in Louisiana have met their aggregate net metering cap under the state’s current net metering rules. In response, regulators have opened a two-phase proceeding (R33929). The first will address how new customers should be compensated once the net-metering limit is reached. The second will address additional potential changes to Louisiana’s solar policies.
Staff members have already recommended that once a cap is reached, customers should be credited at the avoided cost rate. A final decision on phase one is expected by March. Phase two will begin after that.
Separately, Entergy has broken ground on New Orleans’ first utility-scale solar-plus-storage project. The 1-megawatt solar array is coupled with a 500-kilowatt-hour battery to test grid balancing and the potential to provide ancillary services.
Oregon’s two biggest investor-owned electric utilities, PacifiCorp and Portland General Electric (PGE), have announced their support for a bill that would eliminate coal imports by 2035 and boost the state’s renewable energy standard to 50 percent of consumer demand by 2040. While the bill (HB 4036) sets aggressive targets, it’s viewed as a compromise with environmental groups seeking an even more stringent clean energy package through a ballot initiative.
If successful, the ballot initiative would set hard caps on emissions and establish a market-like structure for carbon allowances. The two utilities testified in early February that the legislation offers more flexibility than the ballot proposal, and would ultimately be less costly for ratepayers, The Oregonian reports. Environmental groups have agreed to drop the ballot proposal if HB 4036 is passed.
In late January, the California Public Utilities Commission approved a net metering successor tariff, known as NEM 2.0, that upholds retail-rate net metering. The decision is considered a win for the solar industry, but will bring changes to the California solar market. While preserving net metering, the new regime includes "non-bypassable” charges of 2 to 3 cents per kilowatt-hour that net-metered customers are required to pay. Regulators also mandated an "aggressive" move to time-of-use rates for rooftop solar customers by 2019.
The CPUC also recently approved both Southern California Edison and San Diego Gas & Electric’s electric-vehicle charging programs. The first phase of the SCE program calls for the installation of 1,500 Level 2 charging stations. If successful, the utility will progress to phase two, which calls for 30,000 additional charging stations through 2020 at a price tag of $333 million. SG&E will spend $45 million to deploy 3,500 EV chargers under its Vehicle Grid Integration program
California regulators also continue work on reforming how the state’s IOUs administer energy-efficiency portfolios (R1311005), with comments on the next phase due on February 28. Regulators are also progressing a proceeding on how utilities can better prepare for the integration of distributed energy resources (R1408013). The last workshop was held on February 1.
The Nevada PUC’s decision to increase fixed fees and lower net-metering compensation for rooftop solar customers has gained national attention. Regulators and NV Energy say the changes ensure that rooftop solar customers pay their fair share for using the grid. Solar companies and customers say the policy changes have killed the state’s burgeoning rooftop solar industry.
There’s also been an enormous backlash against the PUC’s decision not to grandfather in existing solar customers to the new rate plan. While NV Energy supports the rate change going forward, the utility says it never intended for the changes to be retroactive. NV Energy recently filed a proposal with seven options for transitioning existing customers onto the new rates. The PUC has agreed to hold a hearing on the grandfathering issue on February 8.
Meanwhile, solar advocates are looking for ways to counter the changes. A group of customers has launched a class action lawsuit. The Alliance for Solar Choice has launched a petition to remove all three Nevada commissioners from office. The newly formed group, No Solar Tax PAC, has launched a ballot initiative that seeks to reinstate Nevada’s old net-metering policy. And a separate group called Nevadans for Affordable Clean Energy Choices has launched a ballot initiative to break up NV Energy’s monopoly.
Separately, the Nevada PUC recently cut funding for several efficiency programs. NV Energy has petitioned the PUC to reinstate a popular pool pump program and a residential lighting program. The Retail Association of Nevada, Home Depot and at least one member of the state legislature are also lobbying regulators to reinstate the two programs. The PUC is expected to respond some time in February.
The newest member of the Arizona Corporation Commission (ACC) announced on February 2 that he would not participate in any proceedings that involve SolarCity due to a conflict of interest. Former Arizona House Speaker Andy Tobin told The Associated Press that his son-in-law recently took a job as an inventory specialist with SolarCity, which triggered the “remote conflict” provision. The ACC doesn’t regulate SolarCity directly, but the solar company is heavily involved in utility ratemaking proceedings. Tobin replaces former commissioner Susan Bitter Smith, who resigned over a conflict of interest related to the cable industry.
Also in Arizona, regulators have approved the $2 billion SunZia power line equipped to carry 3,000 megawatts of wind from central New Mexico and solar from Arizona through the Southwest. Environmental groups raised concerns about habitat fragmentation and questioned whether the line would actually carry clean energy, as SunZia claims, as opposed to fossil fuels. The ACC’s 3-2 vote determines that the project is a net benefit to the state. The debate now goes to New Mexico.
In other Arizona news, the ACC approved Arizona Public Service’s renewable portfolio standard compliance plan in mid-January (E-01345A-15-0241). As part of the plan, APS must file a report on its residential energy storage pilot project, which is expected to begin this spring. Tucson Electric Power is in the process of filing its $57 million 2016 renewable portfolio compliance plan (E-01933A-15-0239), which must enable 6 percent of retail electricity sales to come from renewable resources this year. The plan includes a potentially controversial proposal to qualify community solar as distributed generation. Motions to intervene must be filed by March 4; the first hearing is scheduled for April 5.
Separately, TEP announced on February 2 that it will offer expanded energy-efficiency options to customers in the coming months. New offerings include a program to help schools improve their energy efficiency, incentives for efficient air conditioners, and discounts for Energy Star-certified appliance at participating retailers.
Last year, Hawaii lawmakers established a target to reach 100 percent renewable electricity by 2045. This month, they continue to work through some of the details, including measures to ensure that the law doesn’t include any loopholes. Civil Beat reported a detailed list of legislation up for debate. There are more than two dozen bills up for consideration that could have implications for the Public Utility Commission.
Meanwhile, NextEra Energy continues to work through the regulatory process to acquire Hawaiian Electric Co. Hearings on the $4.3 billion acquisition resumed on February 1. Among the issues up for debate is whether or not NextEra plans to reduce the workforce if it takes control, as well as the $20 million in “change-of-control” payments, which amount to bonuses for utility executives. NextEra leaders insist they can help HECO meet the state’s 100 percent renewable energy target more affordably. Hearings will continue through February 10.
Central Maine Power Company recently notified the PUC that it has reached the state’s 1 percent cap or net-metered facilities, which has triggered a review of the policy (2015-00008). According to EQ Research, Maine has a “discretionary aggregate net-metering cap,” meaning that the PUC is authorized to adjust the cap, but is not required to do so. Eleven other U.S. states with net-metering policies have discretionary aggregate net-metering caps.
This proceeding is separate from a months-long legislatively mandated proceeding (2015-00218) to develop an alternative to net energy billing. That proceeding requires the PUC to submit a comprehensive report on NEM to the state energy committee by January 30, 2016.
Separately, Maine legislators are considering a bill (LD 1339) to cap electricity costs at 10 cents per kilowatt-hour, Energy Manager Today reports. If passed, the residential standard offer service rate would be the lowest in the country, second only to Arkansas. The bill is designed so that if the Maine PUC does not receive bids below 10 cents per kilowatt-hour, the state will suspend its renewable portfolio standards and hold another round of bids. If bids come in below 10 cents, the RPS freeze will remain through the standard offer period.
“I look at this bill as a relief valve,” said Senate President Mike Thibodeau (R-Winterport). “I am not opposed to renewable energy sources; however, when my constituents and the people of Maine are forced to pay higher energy costs because the government has decided to grant an industry special preferences, that is wrong.”
Sustainable Westchester, a group of 24 municipalities that have joined forced to create New York state’s first community choice aggregation (CCA) program, has launched a statewide RFP. The bid is for a year of expected energy, totaling 1.2 billion kilowatt-hours. Top energy providers, including Con Ed and NYSEG, will compete for the contract on price. Sustainable Westchester aims to supply 100 percent renewable energy to participating communities.
New York state as a whole is moving toward a cleaner energy future with the recent approval of a 10-year, $5 billion Clean Energy Fund. The fund is expected to draw more than $29 billion in additional funding from private investors, and will help New York meet its new 50 percent renewable energy target. Regulators said they will include nuclear power in the RPS proceeding, PV Magazine reports.
Also in New York, Department of Public Service staff will submit a report on how to encourage low-income customers to participate in the state’s new community solar program by February 16, 2016.
The solar industry in Massachusetts is calling for lawmakers to lift the state’s net-metering cap. The city of Northampton is also calling for an increase, saying a house bill that would increase the cap by 2 percent doesn’t go far enough. Attempts to raise the net metering cap failed in both the Massachusetts House and Senate last year. State Rep. Frank Smizik (D) recently wrote an op-ed calling for the legislature to reconvene a conference committee to address the cap as soon as possible.
Meanwhile, the Massachusetts SREC-II program is approaching its cap, with just 22 megawatts remaining. SolSystems offers a detailed breakdown of qualifying SREC systems.
Lawmakers in Iowa have introduced a bill (SF 2030) that would require the Iowa Utilities Board to establish a value of solar methodology. EQ Research notes that the methodology must account for the value of energy and its delivery, generation capacity, transmission capacity, T&D line losses, and environmental value. Regulators may also incorporate other values, such as a credit for locally manufacturing or systems installed at high-value locations on the grid.
Conflict continues over FirstEnergy's and American Electric Power’s income guarantee requests. On February 2, grid operator PJM filed documents citing concerns over subsidizing one set of plants, which it says could discourage “efficient new investment,” The Columbus Dispatch reports. The independent power producer Dynegy has come out in direct opposition to the “bailouts.” Environmental and industry groups, including the Environmental Defense Fund and the Electric Power Supply Association, are also against the income guarantee requests. AEP, however, has reached a settlement agreement with the Sierra Club to build large amounts of wind and solar, which could help the utility win approval.
Separately, Ohio lawmakers continue to debate the future of the state’s renewable energy mandate (12.5 percent renewable electricity by 2027), which is currently frozen under Ohio Senate Bill 310. A legislative committee has recommended keeping the freeze in place. However, a new set of reports finds that the costs of complying with the RPS are lower than previously thought, Midwest Energy News reports. Ohio Governor and presidential hopeful John Kasich (R) said at a recent campaign event that he would reinstate the previous renewable energy and efficiency targets if legislators voted to gut them.
Policy developments are tracked in partnership with EQ Research, which offers in-depth subscription services covering regulatory developments, legislation and general rate cases in all 50 U.S. states.