Categories: "Solar Policy"

07/16/20

  07:11:00 am, by Jim Jenal - Founder & CEO   , 1119 words  
Categories: Net Metering

FERC Ruling: Win for Net Metering, for Now!

We have been writing about a petition before the Federal Energy Regulatory Commission (FERC) filed by a shadowy organization calling itself the New England Ratepayers Association (NERA) seeking to gut net metering throughout the United States.  (See my prior posts here and here.)

Well we just learned of the ruling issued yesterday by the FERC, and while it is being widely touted as a big win for net metering, the reality of the decision is far less comforting than the victorious proclamations suggest.  Here’s our take…

Net Metering Survives…

The bottom line of the 3-0 Order Dismissing Petition for Declaratory Order is that NERA’s petition was dismissed by the FERC, with all three Commissioners in agreement.  But this was no full-throated defense of net metering, or even an assertion that the FERC has no business regulating how utilities deal with their rooftop solar customers.  After going back over the petition in painful detail, the order identifies the responding parties, and the arguments advanced in support and opposition to the petition.

One of the more interesting points raised in opposition challenged NERA’s refusal to disclose its members, who pay annual dues in the range of $5,000 to $20,000, which makes them a very special class of ratepayers!  Certainly not an organization of regular Janes, paying their electric bill. 

Noted commenter Public Citizen:

NERA does not disclose its constituent members or the interests it represents; therefore, NERA has not demonstrated that it will be subject to harm based on the outcome of the Petition or that it has an identifiable interest in the proceedings.

And the Pennsylvania Public Utility Commission asserted that

[T]he net metering regulatory scheme is already well established and the Petition fails to identify a specific state net metering scheme that is at issue, even though the Commission requires a concrete case or controversy with limited exceptions… [and the]  Commission’s net metering precedent is sound and there is no controversy or uncertainty to resolve.

That, of course, is a jurisdictional argument – nothing new had occurred to warrant the petition, and the case law that they relied upon was a decade old!  And that is how the Commission decided to resolve this non-dispute:

Declaratory orders to terminate a controversy or remove uncertainty are discretionary.  We find that the issues presented in the Petition do not warrant a generic statement from the Commission at this time. Therefore, we exercise our discretion to decline to address the issues set forth in the Petition, and, accordingly, we dismiss the Petition.

The manner in which the Commission addresses a petition for declaratory order depends on the “specific facts and circumstances” presented to the Commission. NERA in its Petition makes general assertions that Net Energy Metering policies adopted by various states improperly intrude on the Commission’s authority under the FPA and PURPA. NERA states that “it is in the public interest for the Commission to address this Petition promptly so that the pricing of [Net Energy Metering] sales becomes settled and affected parties can make appropriate decisions.” NERA further states that the Petition “focuses on the more common form of [Net Energy Metering] described above, as that was the subject of the Commission’s prior rulings…” The Petition, however, does not identify a specific controversy or harm that the Commission should address in a declaratory order to terminate a controversy or to remove uncertainty… For this separate reason as well, we decline to issue the requested order. 

If you were hoping for a clear signal of support for the concept of net metering, you won’t find it here!

…For Now

To the contrary, what you find in the two concurrences filed with the order is cause for alarm.  Commissioner McNamee noted:

[T]he Commission’s Order is not a decision on whether the Commission lacks jurisdiction over the energy sales made through net metering; nor is it a decision on the merits of the issues raised by and contained in the Petition. I also note, that as a general proposition, I think it is best to decide important legal and jurisdictional questions, like the ones raised in in the Petition, when applying the law to a specific set of facts, such as in a Section 206 complaint, or through a rulemaking proceeding.

That is what you call a roadmap for future filings.  Either repackage your petition as a Section 206 complaint, or bring it up in the next appropriate rulemaking.  But just a petition to end net metering out of the blue was a bridge too far. 

However, McNamee’s view may not matter as his term ended last month, so he will likely go back to his law practice “primarily representing electric and natural gas utilities before state public utility commissions."  Surprise, surprise.

The second concurrence, from Commissioner Danly (whose term does not expire until 2023!) is even more troubling.  He wrote:

The petition for a declaratory order filed by New England Ratepayers Association (NERA) raises difficult legal questions regarding the regulatory treatment of facilities (like rooftop solar) used by retail customers primarily, but not exclusively, to serve their own electricity requirements. These questions not only include the rate treatment for excess generation but, more importantly, the boundary between federal and state jurisdiction to address such rate treatment.

I have yet to reach any conclusion regarding either rate treatment or jurisdictional boundaries, but I am certain that these are questions of profound importance and the Commission will eventually have to address them.

I am concerned that dismissing the petition on procedural grounds may well result in a patchwork quilt of conflicting decisions if the questions raised in the petition are instead presented to federal district courts across the country. While the federal courts are more than capable of adjudicating preemption claims, they are not steeped in the history of the Federal Power Act nor in matters of national energy policy. Confusion, delay and inconsistent rules—some of which will apply to individual states or parts of states—will be the inevitable result.

Nevermind that the Commission has addressed the jurisdictional question before and determined that it lacked jurisdiction over state-operated net metering programs.  And is net metering really a “matter of national energy policy"?  Whether a PWP customer gets full retail value for the energy they sell back to the grid has zero impact on the ratepayers of New England, except, of course, to the extent it reduces the value of their stock holdings in the oil and gas industry.  But that’s really none of FERC’s concern.

So, bottom line, we live to fight another day, and that’s a good thing.  But net metering continues to be under attack, and this order provides no shelter from that coming storm.

Want to do something?  Join CALSSA (or your state’s solar/storage association) or the Solar Rights Alliance - they need your support to fight back.

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06/29/20

  07:47:00 am, by Jim Jenal - Founder & CEO   , 404 words  
Categories: Residential Solar, Net Metering

Update on Net Metering Attack at the FERC

Back in April we wrote about an attempt to eliminate Net Energy Metering - the primary economic benefit for rooftop solar - by way of a misleading petition filed with the Federal Energy Regulatory Commission (FERC). Here’s an update (h/t Utility Dive)…

The petition was filed by an entity called the New England Ratepayers Association (NERA) and if successful, would potentially affect net metering in the 45 states where it presently exists in one form or another.  The FERC regulates interstate electricity markets, and NERA portrayed net metering as a “wholesale sale” of energy, essentially subjecting rooftop solar systems as if they were utility power plants.  From NERA’s FAQ about the petition:

[N]et metering is having an unfair and harmful impact on ratepayers, especially low-and middle-income families. Given this problem, NERA has chosen to challenge net metering at the body which has the proper jurisdiction over wholesale electricity transactions.

Under FERC rules, the public had until June 15 to comment on the petition, and NERA found support from some usual suspects including the Heartland Institute (famous for its climate change denialism), the coal company Murray Energy (hilariously ridiculed by John Oliver a few years ago), the Competitive Enterprise Institute, Americans for Tax Reform (say what?), and Citizens Against Government Waste. 

Curiously, although several utility companies - including PG&E - had suggested that they would comment, none of them did.

In opposition was a very long and bipartisan group of people ranging from solar companies (well duh) and solar trade associations, to local state energy regulators.  For example, the National Association of Regulatory Utilities Commissioners (which includes the California Public Utilities Commission amongst its members) said in its comments:

The [FERC]… has for nearly 20 years acknowledged states’ authority and held that net metering does not involve wholesale sales subject to its jurisdiction… Relying on that settled law, states and utilities have developed and implemented net metering programs, and millions of Americans have made long-term investments in solar panels and other distributed generation for their homes and businesses.

Exactly!

Interestingly, Public Citizen dug up some IRS filings for NERA - which self-describes as "a non-profit organization focused on promoting sound public policy that protects utility customers, both families and businesses, and lowers the cost of regulated services” - that cast doubt on that claim.  According to the IRS filings, NERA consists of 15 members (identities not disclosed), ten of whom pay $20,000 in annual dues and five that pay $5,000.  Not exactly a grassroots organization!

Watch this space!

06/30/18

  02:34:00 am, by Jim Jenal - Founder & CEO   , 276 words  
Categories: All About Solar Power, Solar Economics, Ranting, Solar Policy

LG to Assemble Solar Modules in the US

LG - the exclusive solar module supplier for Run on Sun - has just announced that starting next year they will be assembling solar modules in the United States!  This is big news, here’s our take.

LG NeON 2 solar module

Cell detail of LG’s NeON 2 Solar Module

Ever since the Trump Administration imposed so-called “201 sanctions” on imported solar modules, there has been speculation that companies like LG would start assembling modules in the U.S.  This week that speculation was confirmed as LG announced that they would expand their existing facility in Huntsville, Alabama to create a module assembly plant capable of producing 500 MW of modules per year, with production to begin in “early 2019.”

LG intends to produce their 340 Watt NeON 2 series of 60-cell modules, the successor product to our current go-to, 335 Watt module.  It is not clear whether LG will produce modules with both white and black backsheets, or whether they will begin to manufacture the even higher efficiency, “rear-contact” modules in the U.S.  Given that LG is appealing the tariffs on the rear-contact modules (as they are on the AC module that they make with Enphase) on the grounds that those products do not compete against the cheaper Suniva and SolarWorld modules that are the basis for the (entirely bogus) tariff case (see, Suniva – the Tail Wagging the Dog), it seems that any decision to include their production here would turn on the outcome of that appeal. 

It remains to be seen how much cheaper this will make LG modules, but this appears to be a good development both for about 160 workers in Huntsville, and U.S. consumers.   The tariffs, meanwhile, remain an ignorant policy decision, causing substantial harm throughout the solar industry.

05/30/18

  02:52:00 pm, by Jim Jenal - Founder & CEO   , 321 words  
Categories: All About Solar Power, SCE, Energy Efficiency, Residential Solar, Ranting, Solar Policy

Solar Policy: A Victory and a Challenge

As a reader of this blog, you care about solar policy making, and are no doubt aware that the utilities are constantly trying to erode the value of solar.  Recently we notched a big win, but at the same time the need for vigilance is ever greater.  Here’s our take…

An Historic Win

First the win - as you have no doubt heard, starting in 2020, California will require that all new single-family homes include a solar power system.  (At present, about one in five new homes has solar added when built.)  This will help California meet its ambitious goals regarding greenhouse gas emissions, and will continue California’s leadership in home energy efficiency.

An Ongoing Challenge

As exciting as that news was, it makes it far to easy to overlook the constant, ongoing efforts of utilities, particularly the Investor-Owned Utilities (IOUs), like SCE, to erode the value of solar.  Case in point, SCE has a rate case before the California Public Utilities Commission that attempts to create rate structures that are blatantly hostile to solar power systems.  That means that SCE customers who installed solar in good faith, could see the value of their investment diminished thanks to a concerted effort by SCE to do just that!

Solar Rights Alliance

Fortunately you don’t have to take this lying down.  The Solar Rights Alliance (formerly known as Solar Citisuns) is working to organize solar system owners into a potent political force to push back against the army of lobbyists employed by the IOUs.  There are over 700,000 solar system owners in California - that is an interest group that needs to be heard.  By joining the Solar Rights Alliance you will help to make sure that your interests are being heard by legislators and regulators alike.

It is easy to join: just follow this link to become an active member of the Solar Rights Alliance.  The IOUs have the lobbyists, but we have the people!  Be heard - join today!

02/27/18

  02:14:00 pm, by Jim Jenal - Founder & CEO   , 347 words  
Categories: All About Solar Power, SCE, Residential Solar, Net Metering

Beware SCE's Attempt to Switch Solar Customers to TOU Rates!

 

Attention SCE customers who installed solar before the NEM 2.0 deadline (that is, you installed solar before July 1, 2017) - we just learned that SCE is sending around notices suggesting that you switch over to a Time-of-Use rate. You do not need to make that switch, and you most likely don’t want to!
Here are the facts…

SCE customers who installed solar systems prior to the transition to Net Energy Metering 2.0 rules ("NEM 1.0 Customers") are grandfathered into their existing tiered rate structures for 20 years following their go-live date.  While the costs under that rate structure may change, the basic design - a tiered rate where you pay more the more you use, versus a time-of-use rate where what you pay is tied to when you use it - is locked in.  For most solar system owners, that is a better deal.

But we just learned that SCE is trying to convince NEM 1.0 Customers to switch to TOU rates.  (You can find their oh-so encouraging web page for the transition here.)  For the vast majority of solar system owners, such a transition is NOT IN YOUR BEST INTEREST!  The TOU rates have their highest charges either from 4-9 or 5-8, and their lowest charges between 8 a.m. and 4 or 5 p.m.  That means that any energy exported back to the grid will be compensated at the lowest rate (unless your system happens to be exporting after 4 or 5 in the evening, not very likely), whereas energy you need to use in the evening will cost you the most!  

Check out these numbers:

SCE's 4-9 p.m. TOU rate      SCE's 5-8 p.m. TOU rate
SCE’s 4-9 p.m. Time-of-Use Summer Rates   SCE’s 5-8 p.m. Time-of-Use Summer Rates

Yikes!  That’s a whopping 49¢/kWh if you select the 5-8 p.m. rate - but you will only earn 23¢/kWh for energy that you export from your solar system!  Not a good deal at all!

The good news is you don’t have to make this switch!  And if you mistakenly were convinced to switch, you have the right to switch back.  (Similar scams are underway in PG&E and SDG&E territory as well.)  If you have questions, give us a call and we will help you to sort this out.

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Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
Run on Sun also offers solar consulting services, working with consumers, utilities, and municipalities to help them make solar power affordable and reliable.

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