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Kentucky’s Solar Industry Working To Rewrite Net Metering Bill

Gray Watson/Creative Commons

Kentucky solar advocates want state regulators to consider the benefits of residential solar, but they say that won’t happen under the latest version of a net metering bill under consideration in the state General Assembly.

Last week, the House of Representatives narrowly passed a revised version of House Bill 227, which would allow state regulators to set the rates for the solar power that customers feed back into the electricity grid.

The measure is now before the Senate Natural Resources and Energy Committee and could be considered as early as next week.

Bill advocates, including bill sponsor Republican Rep. Jim Gooch, say it’s a fair compromise between competing interests.

But the solar industry and at least one former state regulator say the bill prevents Kentucky’s Public Service Commission from considering the benefits that solar-powered households offer when they sell excess energy back to the grid.

“Effectively this current language is just directing the Public Service Commission to look at utility costs to serve customers and to make sure the utility gets reimbursed for 100 percent of those costs,” said Matt Partymiller, president of the Kentucky Solar Industry Association, which represents solar installers.

Among other benefits, residential solar power offsets electricity lost in grid transmission and distribution, improves the resiliency of the electricity grid, reduces the need to build new power plants and creates clean, renewable energy.

“The phrase ‘measurable benefits’ needs to be included so that the PSC’s determination can be complete and fair, just and reasonable,” wrote James Gardner, the former chairman of Kentucky’s Public Service Commission,in an email to Republican Senator Jared Carpenter, Chair of the Senate’s Natural Resources and Energy Committee.

He added that the bill would also require the commission to set rates for every utility individually, creating roughly two dozen separate cases. It makes more sense, to have just one case, he said.

Kentucky’s Public Service Commission hasn’t taken a position on the issue, said spokesman Andrew Melnykovych. It has not offered an opinion, nor has the Legislature called on it to testify on the bill, he said.

Meanwhile, utilities such as Louisville Gas & Electric continue to support the measure.

The utility company doesn’t need the extra electricity solar customers have to offer, but still has to buy the excess energy produced by residential solar customers at the retail price of power, said Chris Whelan, LG&E spokesperson.

“We are trying to get to a more reasonable rate then it currently is. Right now we are paying three times more for energy that we have to purchase and we don’t necessarily need,” she said.

Those costs are passed onto ratepayers, though Whelan said they remain small at the moment. Only about 1,000 households in Kentucky with rooftop solar panels put extra energy back onto the power grid through Kentucky’s net metering program.

“That cost is passed onto all our customers, so if you’ve chosen not to have solar on your roof or don’t want it, you are still having to pay for that excess generation,” Whelan said.

Partymiller, with the Kentucky Solar Industry Association, says he’s already met with Carpenter a half-dozen times and is working on changes ahead of the next committee hearing.

“Chairman Carpenter is receptive to our concerns, he’s listening and it does sound like he is trying to work on some sort of resolution that is suitable for the solar industry and utilities,” he said. “That said, I think we are a long way from compromise. It’s really unfortunate that we’ve got a couple weeks left of session and we are just really starting to engage.”

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