Utilities in many states say solar-friendly rate plans, conceived to promote alternative energy sources, are too generous.
Some power companies are proposing an extra fee for solar customers. Others are trying to roll back or block programs that allow those customers to trade the solar power they generate during sunny days for power they need from the grid during other times.
As rooftop solar expands to a mainstream way to save money on power bills, utilities are afraid they will lose so many customers – and revenue – that they won’t be able to maintain the grid.
“We want to make sure that as we change the way our system works that all of that is good for all customers,” said Greg Roberts, vice president of pricing and planning at Southern Co. subsidiary Georgia Power. The utility is proposing additional fees for renewable energy users.
Solar installers say the utility industry is trying to hold onto customers – and protect profits – as U.S. homes and businesses become more efficient.
“They are trying to punish people for buying less electricity,” says Bryan Miller, vice president for public policy at Sunrun, a solar financing company.Mike Easterwood, who paid about $320,000 to install nearly 400 solar panels on top of his self-storage business near Atlanta, says the new charges are designed to discourage people from installing new systems.
“I think it scares the heck out of (utilities), quite frankly,” Easterwood says. “They are a monopoly, and so they operate in monopolistic fashion.”
The fight has come about because solar systems have plummeted in price and grown more popular at a time when U.S. electricity use is flat. That reduces the need to build big new power plants and transmission lines – which is how utilities grow their business, make a profit for shareholders and keep their borrowing costs low. Regulators allow utilities to earn higher profits when they build large projects.
Solar advocates argue rooftop systems instead benefit other customers and the grid. When a home uses the power produced by solar panels, it pulls less power through the system. Even when the panels are producing more power than needed at home, the excess goes to the closest house. Both scenarios mean less stress on the grid.
“Solar customers are paying more than their fair share,” says Sunrun’s Miller.
Utilities disagree, and have proposed charging special fees or rolling back power-swapping rate plans in Georgia, Arizona, California and Idaho.
Georgia Power has asked regulators to add a new fee for solar customers who install new systems beginning next year.
Alternatively, those new solar customers could buy power at prices that the utility says better recoups its costs. “If I turn off my lights, the power company shouldn’t send me a bill,” says James Marlow, CEO of Radiance Solar in Atlanta.
Power companies say Marlow should at least pay for the option of turning the lights back on when the sun isn’t shining.