Bill could destabilize growing Kentucky solar industry

Kentucky joined the nearly half-dozen states currently mulling legislation designed to destroy nascent solar industries in their states in what is rapidly becoming a mind-numbingly familiar story.

Following the leads of states like Indiana, Iowa, Montana, Texas, Arizona and Maine, Kentucky State Senator Jared Carpenter has introduced Senate Bill (SB) 214, a bill the sponsor insists is designed to bring stability to the solar market and protect non-solar ratepayers from cost shifts that exist only in the minds of utility executives who see their profits eroding as solar’s popularity grows.

In reality, the bill sets new restrictions on solar customers’ ability to recover system costs through net-metering and gives utilities an unfettered right to treat solar customers as a separate rate class. Specifically, the legislation would enshrine in law the utilities’ right to charge solar customers demand and fixed charges and allow those charges to bear no relation to the rates charged non-solar customers.

The bill would also allow each utility to argue for a different net-metering rate in separate rate cases instead of having a uniform rate statewide. Industry advocates say the resulting payback-calculation chaos would likely cause customers to decide  against investing in a rooftop solar system, bringing the state’s market to a screeching halt.

Carpenter did learn at least one lesson from watching these battles play out in other states, however: The legislation contains provisions to grandfather current customers under existing rules, as long as the system is installed by July 15.

Other states, most notably Nevada, did not include such a provision in their net-metering decisions, leading to contentious public fights and outrage by solar installers and customers alike.

Nevada has since reversed its decision and grandfathered current customers in under current rules, but the state’s solar industry is still recovering from the fallout of the original decision.

Kentucky’s bill is currently in the Natural Resources and Energy subcommittee.