Maine PUC issues final ruling on net-metering compromise

Current solar customers in Maine can breathe a sigh of relief. Their net-metering benefits are safe for 15 years – but customers who sign up next year are not so lucky.

Yesterday, the Maine Public Utilities Commission (MUPC) issued its final ruling on the state’s net-metering structure, which guarantees net-metering rates will remain at the current retail rate for the next 15 years. In reaching its decision, MUPC said it felt 15 years would be long enough for current customers to recoup the cost of their systems.

The story isn’t quite so bright, however, for customers who sign up after Jan. 1, 2018, though the net-metering deal can still be good for the consumer. Each year, the rate will decline by 10% and remain at that rate for 15 years.

For example, customers who sign up next year will only receive 90% of the credit, but it will remain at 90% for 15 years. In 2019, the credit will decline to 80% and remain at that level for 15 years, and so on.

“The incentives to [net metering] customers under the new rule should not change the length of time it takes for a customer to recoup their investment,” the commission wrote in explaining its decision. “The estimated payback for new installations will be similar to what it has been historically.”

The commission also made it clear the new rule only applies to rooftop solar customers instead of utility-scale projects.

“The commission decided not to address larger scaled projects and community projects as part of the [net metering] rules to ensure we stayed within our regulatory function, and in light of legislative initiatives in these areas,” the commission wrote.

Yesterday’s ruling brings to an end a year-long conversation about how to modify net metering rules in Maine. In January 2016, Central Maine Power Co. informed the commission that solar generation made up approximately 1.04% of its annual peak demand.

As a result, the utility asked for changes to the net-metering rules to reflect its increased impact on the utility’s operations. The commission then offered a proposed rule in September, which received hundreds of comments from affected stakeholders.

Maine’s net-metering discussion has not been without its own controversies. The proposed changes, which had been supported by Maine’s Governor Paul LePage, would have grandfathered previous net-metering agreements for a period of 15 years and set the limit for new systems at 10 years.

It would also have “protected” non-solar customers from having to shoulder transmission-and-distribution (T&D) costs solar customers do not have because they consume the electricity they produce on site, despite numerous studies that prove the cost-shifting argument is a sham. The final ruling appears to be an attempt to thread the needle of those false concerns, by bringing down the incentive gradually while locking those rates in for 15 years after the system is installed.