Yesterday we reported on pending changes to net metering in Louisiana, which regulators will take up at their meeting on Wednesday, September 11. And while we based our analysis of the proposal on a filing in the docket, unbeknownst to us last week, the Louisiana Public Service Commission (LPSC) had filed another proposal, which is the one which will be voted on this week.
Under the Staff Proposed Settlement filed on September 4, LPSC will vote on whether or not to replace the state’s net metering statute with a two-channel billing arrangement involving bidirectional meters and paying the electricity generated by customer-sited solar and exported to the grid at “avoided cost,” which will be based on 12-month locational marginal price averages. In other words, wholesale power prices, which Alliance for Affordable Energy estimates are around 2.7 – 3 cents per kilowatt-hour.
This is less than a third of the retail rate that PV system owners can exchange their electricity for under net metering, and as in other states a move to this arrangement would destroy the economics of rooftop solar and greatly extend payback times.
“This is going to kill the state’s solar market,” states Logan Atkinson Burke, the executive director at the Alliance for Affordable Energy. Burke notes that if this passes, the only place that solar will make any sense to install solar will be in Orleans Parish, which is regulated by the city council, not the LPSC, and retains net metering. She says that other than that “What it really means is that solar will only be available to wealthy people, who will only be able to do it for environmental or cache reasons.”
However, unlike the previous proposal the “grandfathering” period would be extended from five to fifteen years, and homes that are sold will still keep their grandfathering. If approved, the new rules would take effect on January 1, 2020, and any PV systems installed before then would be “grandfathered” in under the old rules through the end of 2034.
The proposal appears to be spearheaded by LPSC Chair Eric Skrmetta (R), who has been a vocal critic of net metering and whose campaigns have been well funded by the state’s oil, gas and utility companies – including the ones he regulates.
In a moment of pure gaslighting, Skrmetta took to Facebook yesterday to make several dubious claims, including that LPSC was “not ending net metering” and that ratepayers who did not engage in net metering were being “tasked with paying for the private solar”, and in what was perhaps the most bizarre claim of all, that he had “led the effort to protect solar”.
The Alliance for Affordable Energy has published a blog post which, without naming him, breaks down a number of Commissioner Skrmetta’s inaccurate claims. One of these is that the electricity that customers generate and use themselves would being credited at retail rate.
“It is as if the utility came to your house and said ‘aren’t we nice, we are giving you the full value of the tomatoes that you grew yourself’,” Burke told pv magazine.
Skrmetta’s six-year term ends next year, and advocates who pv magazine have spoken with have suggested that Skrmetta may be trying to kill the state’s solar industry so that it is not able to support another challenge against him. In 2014 when Forest Bradley-Wright (R), formerly of the Alliance for Affordable Energy, ran against and nearly defeated Skrmetta.
Challenging Skrmetta can have consequences; during the race the home of Wright’s chief fundraiser was firebombed.
Skrmetta has denied any connection to the arson.
The author is a former employee of the Alliance for Affordable Energy.
Correction: This article was corrected at 9:18 AM EST on September 12. The article previously described the new system as “buy-all, sell-all”, when the correct description for the new system is “two-channel billing”. We regret the error.
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