Net metering settlement a win for solar in Utah
Oct 18, 2017
Once again, the solar industry has been placed in a position that is odds with traditional power companies, and once again, legislation has passed to level the playing ground.
As of Oct. 4, during the Governor’s Press Event on Net Metering Settlement, the decision was announced to override the proposal put forth by Rocky Mountain Power Company back in November 2016.
Shane Perkins, co-founder and co-owner of Legend Solar, says they are happy with the result.
“We feel like it’s a win for solar,” Perkins says.
The problem reared its head on Nov. 9, 2016 when Rocky Mountain Power proposed a rate plan that would make getting a return on the investment into rooftop solar panels much more difficult to achieve.
According to an article in the Salt Lake Tribune, the proposed plan would have assigned a new rate structure to net-metering customers. The rates would include a decrease in the per-kilowatt hour price for power purchased from the utility and it would introduce a “demand charge” that could dramatically increase customers’ power bills.
In essence, the proposal would have been “detrimental to the solar industry,” Perkins says.
Although Perkins says the blow might not have been as bad as the one attempted by Nevada Energy, “it would have been a struggle for anyone involved in the solar industry.”
It turns out, even the suggestion of such a change to the net metering rates within the state of Utah created quite a stir among current and potential solar customers.
“Anytime you have a public announcement like that it makes people wary,” Perkins says, adding that they received numerous questions about things such as whether or not current customers would be grandfathered in at the old rates. “It kind of put a freeze on the market for quite a few months.”
The art of compromise
Several Utah solar companies got involved in an attempt to work out a compromise with Rocky Mountain Power. During the discussions the parties involved were not allowed to share what was being discussed. The non-disclosure period lasted from Nov. 9, 2016 to Aug. 9 of this year.
“Having to wait that long was a bit of a challenge. We kept getting close to settlements,” Perkins says.
However, at the end of the day, Perkins says it had to be a give and take from both sides because, “we never wanted the power company to go out of business and I don’t think they wanted us to go out of business.”
Perkins says he’s grateful so far everyone has been cordial because he knows that is not always the case in industries where multiple companies are in direct competition.
As it stands now, Rocky Mountain Power will continue to accept new net-metering applications and grandfather them in under the old rate plan through Nov. 15 — so there has never been a better time to get into solar. After that, new customers will be subject to the new rate plan.
As for the compromise, customers will get dollar for dollar anything that they produce and consume during the day. Any excess will be exported back to the power grid at 90 percent.
Those grandfathered into the system before Nov. 15 will still receive 100 percent payment for any excess power exported back to the grid.
“They’re (customers) only losing 10 percent,” Perkins says.
And even though 10 percent is more of a loss than Legend Solar would like to see its customers have to accept, Perkins says they are happy with the way things turned out.
“If you keep things in perspective, they (power company) were willing to almost destroy the solar industry with their proposed rate structure. What we ended up settling on is not a huge loss.”
The agreement also says there will be no demand fee. There will be an application fee, but that’s something Legend Solar plans to simply absorb for its customers.
While there is no way of knowing if the battle with Rocky Mountain Power is the last of its kind the solar industry will face, if you consider other industries with parallel growing pains, it may not be the last. But ultimately, Perkins says solar will rise to the occasion.
“We’re pretty parallel with the cell phone industry,” he says.
When cell phone technology first arrived on the scene, many of the big telecommunication companies saw cellular as just “a flash in the pan,” Perkins says. Then, when cell phone technology started gaining traction, the telecom companies wanted to squash it. “But at some point, technology just wins.”
“There will always be a place for coal fire plants and all the energy sources right now,” Perkins says, “but I believe renewable energy will take a front seat, instead of a side seat to those more traditional power sources.”
Take advantage of the transition period and lock in with solar panels before Nov. 15. For more information on how you can purchase solar panels, get a free quote at www.legendsolar.com