Controversial net metering bill in Kentucky voted out of committee

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Kentucky’s House of Representatives’ Standing Committee on Natural Resources and Energy voted this morning to move a controversial net metering bill to the floor for debate by the entire House of Representatives.

The bill passed the committee 14-4, with four members “passing”. Twelve votes were needed to send the bill to the House of Representatives for a full floor debate.

House Bill (HB) 227, introduced in late January, would end retail net metering for new customers on July 15.

The committee vote is the first step toward passage of the bill, which for the second year in a row would attempt to slash net metering rates for solar consumers. HB 227 would cut compensation for excess electricity generation by nearly two-thirds.

Currently, Kentucky’s solar consumers are compensated at the going retail rate for any excess electricity they export back to the state’s grid.

In an unusual move, there was no discussion in the committee of the bill itself. Instead, the committee moved directly into a roll call vote, giving each member two minutes to explain their votes.

At least three of the “yes” votes explained that they had grave concerns over some of the bill’s provisions and reserved their rights to vote “no” when the bill came up for a vote before the full House.

Multiple committee members said they didn’t like the bill as written and would be amending it, while others said they believed a compromise between the utilities and the solar industry could be reached.

In a further blow to the economic case for solar in the Commonwealth, the bill would prevent solar users who are grandfathered under the bill (current solar users are allowed to keep the one-to-one net metering payments through July 15, 2043) from offering that grandfathering mechanism to new owners if they should sell their homes.

In other words, once a home is sold, the new owner of the solar-electric system would immediately lose their right to retail net metering.

Sponsors of the bill say it is necessary to relieve non-solar customers from a “cost shift” they say is the result of solar users not paying for grid upkeep. It’s an argument commonly used by utilities around the country when they try to change net metering rules, despite no hard evidence that the shift is significant below 10% penetration.

In fact, a national study by the Lawrence Berkeley National Lab, suggest that this “cost shift” is non-existent when solar penetration is 10% or less. According to the most recent data from the Solar Energy Industries Association, Kentucky currently generates 0.05% of its electricity from solar.

One year ago, the Kentucky legislature defeated a similar bill that would have imposed demand and fixed charges on solar customers that bore no relation to the rates charged non-solar customers, throwing the solar payback calculation process into chaos.

While the current changes being proposed under HB 227 would not be as damning given that they only apply to monthly surplus generation, this would further weaken the business case for residential solar in the state.

No floor vote has been scheduled yet (in fact most of the House probably doesn’t even know the bill passed out of committee yet). pv magazine will be monitoring the situation and will update the story as more information becomes available.