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Indiana SB 309 to change solar/wind net metering as amended still BAD

Posted by Laura Arnold / February 26, 2017 / Posted in 2017 Indiana General Assembly, solar, wind / No Comments

Solar bill passes out of committee

Amendments relax restrictions on net metering, but solar advocates remain flustered

Devin Zimmerman, Feb 23, 2017

Despite changes to the regulations proposed to Senate Bill 309, solar advocates remain wary of State Sen. Brandt Hershman’s legislation.

Last week the Senate Utilities Committee convened to vote on SB 309, which includes sweeping reforms that solar advocates argued could have removed many of the benefits associated with homeowners adopting their own solar arrays. The day of the meeting, amendments were introduced to the bill that eased some of the restriction’s previously posed against the renewable energy industry, but opposition to the bill remained concerned.

Sen. Michael Delph introduced the amendments to SB 309, which relaxed some of the restrictions proposed in the first version of the legislation. Since the amendments were introduced, the proposal passed out of the Senate Utilities Committee after an 8-2 vote.

With the amendments, those who already have solar arrays in place will receive the present retail rate for their excess energy for another 30 years. Those who adopt renewable energy technology over the next five years also receive a higher retail rate for energy sold back to the utility companies until 2032. After 2022, should a consumer construct his or her own renewable energy infrastructure, the incentive shrinks even more.

But still, when these deadlines are reached, clean energy advocates worry that the industry still will suffer greatly.

“When I export energy if this bill is law, the exported energy won’t be reimbursed at a one-for-one rate (after the deadlines are reached),” said Chris Rohaly, the president of the solar panel construction company Green Alternatives. “It will be credited at what they call the avoided cost, which is, from a utility perspective, either I can buy from the coal plants or I can buy from a private solar array. That’s down to about three cents per kilowatt per hour, approximately.”

At three cents per kilowatt an hour, the rate after the deadlines is reached is much lower than the 10 or 11 cents, depending upon location in Indiana, that is the present market rate. So, when that rate takes place, a large savings incentive is lost to solar users.

Additionally, the amendment also altered the percentage of a grid’s total energy that could originate from renewable energy. Before, a cap was set at one percent. When one percent of a grid’s energy came from renewable energy, anyone above that limit would not be eligible for net metering. Under the amendment, the cap increased to 1.5 percent.

Again, solar advocates worried about the cutoff’s impact on clean energy industry growth.

“That extension only applies as long as we are under that 1.5 percent cap,” said Rohaly. “As distributed energy grows in popularity, it’s quite possible that cap will be met well before the extension order runs out. Right now that’s whatever comes first … I will say Indiana is really low there as well. For instance, I just found out that in West Virginia, they just reduced their cap to three percent. They’re still twice what we are. Our neighbors I believe, Illinois and Ohio, are five percent. We’ve got a very low cap.”

In last week’s meeting, Hershman defended his bill vehemently.

Primarily, he argued that the extensions the amendments provide are generous and that five years is time enough for those seeking to adopt the technology.

He also claimed that if net metering persisted, it could have a negative impact on the prices for utility users.

“Yes, there is a reason not to do this forever and at this rate because, as it grows, the subsidy that was demonstrated by these independent authorities grows to a point where it will have a negative impact on rates for all consumers,” said Hershman during the hearing. “Not only residential but industrial as well.”

The Hoosier Environmental Council, which already expressed displeasure with Hershman’s proposal, also issued the following statement after the proposal passed out of committee.

“Governor Eric Holcomb made innovation one of the central themes of his State of State Address. Gov. Holcomb has made fostering entrepreneurship a central priority of his new Administration. Those priorities — innovation and entrepreneurship — are presumably ones embraced by his Indiana State Senate counterparts. But those priorities are not reflected in the amended version of SB 309.

“This bill, without any disclosed, objective, Indiana-specific study to justify this enormous change in policy, worsens the investment landscape for rooftop solar by forcing an arbitrary reduction in the value that our electricity grid assigns to solar energy and enabling the possibility of utilities imposing a new fixed fee on customer-owned solar generation; these concerns remain even with the amendment in Committee today.

“SB 309, if adopted into law, may well have long-term impacts in terms of deterring investment in solar energy by both homegrown entrepreneurs and those who may otherwise see Indiana as a promising investment destination for solar. The most constructive way forward is for the Indiana State Senate to call on the Indiana Utility Regulatory Commission to do a study that transparently assesses the benefits and costs of solar and offers recommendations on changes needed to Indiana’s solar energy-related policies in order to ensure that our state is at the forefront of welcoming solar entrepreneurs and advancing solar innovation.”

Kokomo High School with wind turbine on net metering worried about financial impact of SB 309

Posted by Laura Arnold / February 24, 2017 / Posted in 2017 Indiana General Assembly, solar, wind / No Comments

Northwestern concerned about Senate energy bill

By Caele Pemberton Kokomo Tribune

KOKOMO - A bill in the Indiana Senate could change the way schools look at renewable energy.

Senate Bill 309, titled Distributed Generation, would change how people and organizations sell energy back to energy companies. For schools that have already invested in solar panels and wind turbines, the bill could lead to lower paybacks.

The Northwestern School Corporation installed a wind turbine in 2012 after the Indiana Utilities Regulatory Commission approved net metering, allowing individuals and organizations, including businesses and school corporations, to be credited at the retail price of electricity.

“When they passed net metering, that made it financially attractive for us to go ahead and proceed (with the turbine),” said Ryan Snoddy, Northwestern superintendent.

Snoddy estimates that the school would lose 5 to 7 cents per kilowatt of electricity produced by the turbine if net metering is removed, which could add up to more than $40,000 a year, he said. The turbine produces just under 1 megawatt of energy a year.

Earlier this month, an amendment was added to the bill that would allow certain qualifying entities, such as Northwestern and other schools, to continue net metering for the next 30 years. An earlier version of the bill would have extended net metering for these entities for the next 15 years.

Snoddy said the extension, which would mean the school would be able to continue net metering until 2047, improves the bill, but it still doesn’t make it appealing. The school will eventually have to consider replacing the top of the turbine, but only if the investment in alternative energy is still worth it, he said.

“I’d like to see schools and cities exempt,” he said.

The school has considered adding solar panels as well, but Snoddy said the return on that investment would be smaller than on the turbine. They still could add wind turbines in the future, he said.

“The benefits to us for doing solar would be a hedge against inflation and utilities cost, and the fact that we could demonstrate green energy,” he said.

The bill’s author, Brandt Hershmann, said the bill doesn’t discourage alternative energy, but it will protect other energy rate payers.

“The wholesale price of energy is somewhere between 3 and 4 cents, but retail is between 11 and 12 cents,” Hershmann said. “If you have a solar panel on your roof, you can generate energy for your own use, and anything you put back, you’re credited for at full retail rates. The cost pressure of that, it amounts to a significant subsidy.”

Hershmann said people can still receive that subsidy until net metering is no longer allowed, and he said that’s fair given the declining cost of alternative energy technology.

“As we see the cost of alternative generation going down because of improvements in technology, it is becoming more and more competitive with traditional means of generation,” he said. “We think it will be able to compete very well on its own without a subsidy.”

The Kokomo School Corporation is planning to add solar panels to Pettit Park Elementary, but Kokomo Superintendent Jeff Hauswald said the panels would not create enough energy to make a financial difference for the school. However, he said the bill appears to look backward for Indiana.

"Alternative energy is a reality for many people," Hauswald said. "The market will drive change, and anytime we pass legislation that can negatively create a roadblock to progress, it doesn't make sense."

Education Reporter Caele Pemberton can be reached at 765-454-8587, by email at caele.pemberton@kokomotribune.com or on Twitter @CaelePemberton

IndianaDG Asks Sen. Merritt to Hold Committee Report on SB 309 Until Info Corrected on Existing Net Metering Rule

Posted by Laura Arnold / February 20, 2017 / Posted in 2017 Indiana General Assembly / No Comments

February 20, 2017

Open Letter to Sen. Jim Merritt, Chair of the Senate Utilities Committee:

The owners of several Indiana solar companies and their customers are deeply troubled over what they believe are serious misrepresentations of Indiana’s current net metering rule during the discussion of SB 309 at the Senate Utilities Committee hearing Thursday, Feb. 16.

Many of them did not have a chance to watch the video of the proceedings until the weekend. When they did, they heard Sen. Brandt Herschman make some statements about the existing net metering rule in 170 IAC 4-4.2 to the committee that simply are not true.

In fact, some of his misstatements are so egregious we think they may have unfairly influenced Thursday’s committee vote. For this reason, we strongly urge the committee not to move forward on its report on SB 309 until these errors can be rectified. We also believe committee members should have a chance to change their vote after they receive the correct information.

First, Sen. Hershman said: "Currently, under existing net metering rules from the IURC, when any individual utility reaches the renewable part of their portfolio, that is people net metering, that is equal to 1% of their baseload generation, net metering goes away. Gone. No grandfathering, no guarantee, nothing except wholesale rates." That is false.

Second, in response to a question from Sen. Houchin, Sen. Hershman says and if the 1% net metering caps were met the utilities could go to a "buy all, sell all" mechanism under existing law. That also is false.

These inaccurate statements by Hershman already have gone viral on social media and may well cause Senate phone lines to further light up this week as a growing number of people learn of them.

We know your committee members want to be as well informed as possible as they work to sort through SB 309, and that they also value their credibility with the public. In that spirit, we implore you to reconvene the committee so this critical misinformation can be brought to light.

On behalf of solar energy companies who are members of IndianaDG and their customers, we thank you.

Laura Ann Arnold, President

Indiana Distributed Energy Alliance (IndianaDG)

Laura Ann Arnold, President

Indiana Distributed Energy Alliance (IndianaDG)

Laura.Arnold@IndianaDG.net

(317) 635-1701 office; (317) 502-5123 cell

CC: Members of the Senate Utilities Committee

KPC News.com: Fair solution needed for solar energy

Posted by Laura Arnold / February 19, 2017 / Posted in 2017 Indiana General Assembly, solar, Uncategorized / No Comments

KPC NEWS.COM

Fair solution needed for solar energy

(Sorry for formatting problems. Please click headline to read.)

Posted: Saturday, February 18, 2017 11:00 pm

One of the hot controversies in the Indiana Legislature is about to land in the lap of a local lawmaker.

Rep. Dave Ober, R-Albion is the new chair of the House Utilities, Energy and Telecommunications Committee. A bill involving solar energy is poised to hit his desk next month.

Ober expects to be the House sponsor of Senate Bill 309, which changes the rules for selling excess solar energy to utility companies.

Ober said the bill is taking up at least 80 percent of his time. It’s being cast as a battle between small solar energy users and utility companies.

“They see this as the big-monopoly utilities trying to muscle out the growing renewable energy in the state. I don’t see it that way,” Ober said.

Ober believes he can steer the bill toward a win-win outcome. Better yet, win-win-win, because the rest of us have something at stake, too.

“Net metering” is at the core of the issue, and Ober does a good job explaining it.

If you have solar panels on your roof, or outside a factory, you can have an electricity meter than runs both forward and backward. Sometimes you’re producing power and sending the excess back to your local utility. Sometimes you’re using more power than you’re making, so you’re drawing from the grid.

If you make 5 kilowatts of energy and use 6 kilowatts, you pay the utility company for 1 kilowatt.

Under present rules, you buy and sell the electricity at the same rate. A disputed feature of SB 309 would change that. The utility would buy it from you at a lower rate — the wholesale price it pays for other generated power — and sell it back to you at a higher retail rate.

One proposal, called “buy all, sell all,” says the utility would buy all of your kilowatts at the lower rate and sell all of its kilowatts back to you at the higher rate.

A “buy all, sell all” rule could be the nation’s worst for solar users, critics say. Utilities say it would be fair to other customers, because right now utilities are overpaying for solar electricity.

Under present rules, other customers are subsidizing solar-energy users, who don’t pay for maintaining the grid, the utilities say. Today, the subsidy may not amount to much. Indiana has fewer than 1,000 users of net metering, although the number is growing rapidly.

Another feature of the bill would set a time limit of 2027 for the practice of net metering.

Fans of solar power say the whole package would make it less attractive to use the sun’s energy in Indiana.

Ober sees an advantage for solar power users, however. It would give them certainty about how long they can count on net metering. That’s lacking now, he said.

The existing state rule says Indiana utilities must offer net metering until it reaches 1 percent of their peak demand. When it hits that level, they can end the program, Ober said. At least one utility — Duke Energy — is almost there.

“I don’t think many people understand that this program is uncertain in the future,” Ober said.

The bill would grandfather net metering for existing customers for 30 years or until their equipment wears out, Ober said. New solar users would know the rules for the next 10 years.

“This thing’s not chiseled in stone. It’s likely to change,” he added. He expects the “buy all, sell all” rule to be tweaked. Rates for buying and selling could be adjusted.

“We’re going to try and come up with a compromise that everyone can live with,” Ober pledged. “If the bill dies … we go into the future with quite a bit of uncertainty about how we treat our solar customers. I think that’s a disservice to them.”

Ober said he’s not against encouraging solar energy. However, he said, “The cost is coming down to the point where it’s not necessary to incentivize it as much as we have in the past.”

Ober told Midwest Energy News, “I hope I’ve built up a reputation in the Statehouse as someone who is a little more thoughtful in trying to find what’s good policy.”

We encourage Ober to keep building that reputation by finding a solar-energy solution that’s fair to everyone.

OUR VIEW is written on a rotating basis by Dave Kurtz, Grace Housholder, Michael Marturello and Barry Rochford. Publisher Terry Housholder is also a member of the editorial board. We welcome readers’ comments.

SB 309 seeks to drastically reduce value of privately produced solar power

Posted by Laura Arnold / February 19, 2017 / Posted in 2017 Indiana General Assembly, solar / No Comments

Bill seeks to drastically reduce value of privately produced solar power

Jessie Higgins , Evansville Courier & Press; 10:04 p.m. CT Feb. 18, 2017

Local solar energy users are facing off against big utility companies this month over a proposed law that would drastically reduce the value of privately generated solar power in Indiana.

Senate Bill 309's supporters say solar users are overpaid for their power, and the bill sets a fairer price.

“People think this bill is anti-solar, and that’s just not true,” said Chase Kelley, a spokeswoman for Vectren.

But, critics fear the move could destroy Indiana’s budding solar industry.

“I’m very concerned for what affect this will have on the solar industry,” said Susan Sirnic, the leader of the Green Team at Bethlehem United Church of Christ, which recently installed a solar system on its church. “It would make it hard to recover your investment.”

Under current state law, utility companies are required to participate in an energy swap with solar users.

The process is called net metering. Solar users take electricity from the grid when their systems don’t produce enough energy to power their homes. But, when the panels produce more energy than the homes need, the excess power is sold back to the grid.

By law, utility companies must pay solar users the full retail price for that power.

“Right now, all we’re doing is swapping kilowatt hours for kilowatt hours,” Sirnic said. “We receive the same retail rate that we pay.”

The problem, utility companies say, is the power is not worth that much.

“The retail rate includes more than the cost of the energy,” said Mark Massel, the president of the Indiana Energy Association, which is working to get the law passed. “It includes the cost to maintain the grid.”

About 30 percent of the retail price covers the cost of the electricity, Kelley said. The other 70 percent covers grid maintenance, customer service, meter reading, billing and energy efficiency programs.

When Indiana first established net metering in 2005, the system was designed to promote – and subsidize – solar users, Kelley said. Solar panels can cost a home owner tens of thousands of dollars to install, and it takes years for solar users to earn back their investments on the systems. Paying users retail rate for their power helped them earn that investment back quicker.

“It was always meant to be a subsidy,” Kelley said.

And it’s time for the state to lower that subsidy, she added. The cost of solar systems has dropped in the last decade since the state first introduced net metering.

More people are investing in solar systems, and the money they save through net metering is being passed to customers who don’t have personal solar power, Kelley said.

“There are a lot of people who can’t afford to invest in solar,” Kelley said. “They shouldn’t be forced to pay for people who do invest in solar.”

The bill’s opponent’s counter that the cost being deferred to non-solar customers is negligible, a few cents a month. Furthermore, they argue, there is a social and societal benefit to solar electricity.

Local solar installers are calling for the state to postpone changes to net metering laws long enough for an independent group to study the true cost and value of solar power to utility companies in Indiana. [emphasis added]

“There have been studies done in other states that show that the value of solar power is close to the retail rate,” said Ryan Zaricki, the president of Whole Sun Designs, an Evansville based solar system installing company. “It is so frustrating that (lawmakers) are so adamantly against a study. When they pull these numbers out, I keep saying, show me the study.”

If Senate Bill 309 passes, utility companies would be allowed to gradually reduce the rate that they pay solar users for their power to closer to the market rate for raw power.

The bill before the Senate this week, stipulates that anyone who installs solar systems before June 30 will receive the retail rate for the solar power they produce – for the next 30 years. After June 30, the bill allows utilities to gradually reduce the rate they pay.

“There is going to be an onslaught of people getting solar systems installed before that June 30 deadline,” Zaricki said. “We’re going to see a boom, and then it’s going to fall off. They call it the solar coaster.”