NewEnergyNews: TODAY’S STUDY: The Solar Policy Fight Goes On

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    Monday, May 13, 2019

    TODAY’S STUDY: The Solar Policy Fight Goes On

    The 50 States of Solar: Q1 2019

    April 24, 2019 (North Carolina Clean Energy Technology Center)

    Executive Summary

    OVERVIEW OF Q1 2019 POLICY ACTION

    In the first quarter of 2019, 43 states plus DC took a total of 160 actions related to distributed solar policy and rate design (Figure 1). Table 1 provides a summary of state actions related to DG compensation, rate design, and solar ownership during Q1 2019. Of the 160 actions cataloged, the most common were related to DG compensation rules (47), followed by residential fixed charge and minimum bill increases (32) and community solar (25).

    TOP FIVE SOLAR POLICY DEVELOPMENTS OF Q1 2019

    Five of the quarter’s top policy developments are highlighted below.

    Maine State Legislature Restores Retail Rate Net Metering

    The Maine State Legislature passed L.D. 91 in March 2019, which restores traditional retail rate net metering in the state and prohibits the buy-all, sell-all successor tariff adopted by the Public Utilities Commission in 2017. The Governor signed the bill in early April 2019, and the Commission opened an emergency rulemaking to amend the state’s net metering regulations.

    Kentucky Lawmakers Initiate Development of Net Metering Successor

    Kentucky legislators enacted S.B. 100 in March 2019, directing the Public Service Commission to establish new monetary credit rates for energy exported to the grid. The bill also allows utilities to implement rates to recover fixed and demand-based costs of serving customer-generators. Customer beginning to net meter before the new credit rates are established will be grandfathered for 25 years.

    Arkansas Legislature Legalizes Solar Leasing and Addresses Net Metering

    Arkansas lawmakers enacted S.B. 145 in March 2019, which legalizes solar leasing, increases the net metering system size limit, and allows solar-plus-storage systems to net meter. The bill also requires utilities to offer retail rate net metering to DG customers that are subject to rates that include demand charges, and directs regulators to establish a netting period and credit rates for DG customers served on rates that do not include demand charges.

    Colorado Regulators Open Rulemaking on Community Solar and Net Metering

    The Colorado Public Utilities Commission opened a rulemaking in February 2019 addressing several of the state’s electric rules, including community solar and net metering. The proposed rules include provisions related to net metering under time-of-use rates, installation of additional meters, and contribution of excess community solar credits for low-income energy assistance.

    Sacramento Municipal Utility District Proposes Grid Access Charge

    In March 2019, Sacramento Municipal Utility District (SMUD) proposed a new Grid Access Charge for customers with on-site generation. The charge would begin at $8.00 per kW of DG system capacity in 2020 and increase to $11.00 per kW by 2025. Existing systems would be grandfathered for a period of 10 to 20 years from the initial billing period after installation. SMUD withdrew the proposed charge in a revised proposal filed on April 22, 2019.

    THE BIG PICTURE: INSIGHTS FROM Q1 2019

    State Legislatures Weigh in on DG Rate Design

    Several state legislatures are considering bills either authorizing or prohibiting additional fees for DG customers. A bill enacted in Arkansas in March 2019 allows the Public Service Commission to establish a per-kWh fee to recover quantifiable, direct demand-related distribution costs from net metering customers, while a bill enacted in Virginia allows electric cooperatives to adopt demand charges for net metering customers. A bill pending in Iowa would establish four alternatives to the state’s current net metering policy, one of which includes a minimum bill and one including a demand charge. On the other hand, bills pending in Kansas and Texas prohibit additional charges for DG customers. A Kentucky bill would have limited the types of costs that may be recovered through fixed charges, while a South Carolina bill takes a study approach, directing regulators to consider the cost of service impacts of customer-generators on other customers within the same rate class.

    States Move in Different Directions on Net Metering

    The first quarter of 2019 was characterized by states moving in very different directions regarding net metering. Kentucky lawmakers enacted a bill that will move the state to a net billing regime, while Maine legislators voted to restore net metering in the state after regulators adopted a buy-all, sell-all compensation framework in 2017. Arkansas also established certain guidelines for net metering successor tariff development, while other states, such as New Hampshire and Washington, moved forward bills that expand net metering by increasing system size limits or aggregate capacity limits. While many states are actively considering net metering successor tariffs, it is worth noting that two states that had previously adopted particularly dramatic policy changes – Maine and Nevada – have now reversed course and reimplemented traditional net metering.

    New States Eye Community Solar Programs

    A number of states without community solar enabling legislation considered major community solar bills during Q1 2019. Among these states are Florida, Nevada, New Mexico, Pennsylvania, and South Carolina. Each state’s proposed legislation would establish community solar guidelines that allow participation by third-party developers. Notably, these bills all also include provisions to encourage participation by low-income customers, such as carve-outs. Low-income access is a program design consideration that is starting to become standard practice in community solar policy. The Michigan Public Service Commission is also conducting a stakeholder proceeding to consider barriers to third-party community energy projects in the state.

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