Maine regulators delay decision on net metering

As a sparsely populated rural state in the Northeastern corner of the United States, Maine has not been a very large solar market. However, it has been on the forefront of fights over net metering, given a caustic battle in the state government over the future of the policy.

In late April Maine Governor Paul LePage (R) vetoed a bill that would have created a new compensation structure for distributed PV systems in lieu of net metering. Since that bill failed Maine regulators have created a new proposal which will slowly dismantle net metering by reducing compensation by nearly half for net-metered PV systems, which would be phased in over 10 years for new systems. The new proposal also includes applying transmission and distribution (T&D) charges to electricity from PV systems which is consumed on-site, which advocates say may violate state law.

When unveiled in September this proposed policy was widely denounced by the solar industry, which said that it would kill the state’s solar market. “It’s a massively aggressive roll-back of net metering,” Natural Resources Council of Maine (NRCM) Climate and Clean Energy Director Dylan Voorhees told pv magazine.

However, now the Maine Public Service Commission (MPUC) appears to balking on pulling the plug, and MPUC has extended its decision on the policy. In a press release on its website, MPUC states that it “hopes to decide the rulemaking issues during the first part of 2017”, while it continues to review comments.

“This is an important Rule and more time is needed to consider the Proposed Rule in light of the comments we received to ensure that the Rule treats all ratepayers in a fair manner” noted MPUC Chairman Mark Vannoy. “It remains clear that changes in technology and costs of small renewable generation, particularly solar PV, require a careful review of the current Rule and potential modifications.”

The reason cited for the delay is review of the comments, and MPUC describes the comments and the participation of stakeholders to date as “helpful”. NRCM provided more detail as to the reaction from Maine residents. “In the public hearing and the public comments, people reacted loudly against it,” stated NRCM’s Voorhees.

Until the final rule is completed, the current rules for net metering remain in place. However, solar installers are complaining that the uncertainty about the future of the policy is causing customers to delay their decision to buy a system.

There is an irony to the degree of ink that has been spilled over net metering in Maine, given that in January the capacity of the state’s PV systems under net metering represented only 1% of peak load on the Maine grid. Many states such as California, Arizona and Hawaii have integrated much higher penetrations of solar, with California even today keeping a very similar version of its original net metering program.

Pressure on the policy appears to be driven in part by political leadership which gives little heed to evidence. In a personal style similar to President-Elect Donald Trump, the ill-informed and bombastic Governor LePage has repeated the myth that Maine’s limited number of distributed solar customers are shifting costs to other customers.

This was after LePage rejected a state-funded report which showed that the 20 MW of solar which Maine has currently installed is reducing the electric bills of non-solar customers by $62 million annually, and would continue to do so at much higher levels of solar penetration.

In the interim, Maine’s solar industry remains in limbo. Voorhees of NRCM says that the delays are preventing Maine legislators from responding to a final policy. “It’s very disruptive to the ability of lawmakers to put policy in place,” stated Voorhees. “That is compounded by the fact that they didn’t need to put this policy forward in the first place.”

Ultimately, it is the workers in Maine’s roughly 350-person strong solar industry that will pay the price. “It is unclear how active the market is going to be given that uncertainty,” says Voorhees.

 

Corrections: This article was updated at 10:40 AM Eastern Time (U.S.) to correct a mis-characterization of the proposed policy by MPUC. We regret the errors in the original. Additionally commentary from NRCM has been added.