A coalition of solar, environmental, and consumer advocates condemned a recent decision by Indiana utility regulators that will “considerably set back” the rooftop solar market in southwest Indiana.
The Indiana Utility Regulatory Commission (IURC) delivered a final order (Cause No. 45378) that reduces the credit received by future solar owners served by CenterPoint Energy unit Vectren South. The decision also changed the period for earning credits so that more customer-owned solar generation is credited at the new lower rate.
In its decision, the commission ruled that instantaneous netting would “reasonably result” in new distributed generation customers paying for the energy they are supplied by Vectren South, “no more and no less.”
The green energy groups called the ruling “a dramatic setback” for customer-owned solar in the utility’s service territory. They said it would solidify the utility’s “monopoly stranglehold on captive consumers.”
One solar installer told regulators that Vectren South’s proposal would cut the net metering rate of 14.3 cents for residential and 9.3 cents per kWh for commercial customers to about 3.1 cents per kWh. He said that the utility’s proposed instantaneous netting methodology would “drastically reduce or dry up” his company’s business, and he said the proposal would more than triple the expected customer payback period from 7-10 years to about 25 years.
The utility based its net metering rate on the average marginal price of electricity that Vectren South paid during 2019. It averaged that price at Vectren South’s SIGE.SIGW load node, which it said represents the marginal price the utility paid for energy. That price of $25.47 per MWh was used in a formula to yield $31.83 per MWh.
In its ruling, the commission said it found no support for continuing what it said was subsidization by non-solar customers of solar customers’ system payback periods. The utility testified that the cost to manage distributed generation customers–from interconnection evaluation to billing–are greater than those for other customers. Similarly, the utility’s witness testified that outflow produced by customer-owned resources does not reduce power plant, distribution, or transmission system costs.
The commission said that distributed generation customers could install a commercially available battery to make greater use of their solar system’s production. It acknowledged that such technology is expensive and may lengthen a solar system’s payback period. However, it rules that a longer payback period does not require Vectren South to continue allowing customers that own distributed generation resources to “use Petitioner’s electric system as their battery.”
It said that the fact that solar customers are generating behind the meter and, it said, buying less electricity, “will generate value and return on their private investment.”
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Homeowners can form coops and kick out the utilities.. They can install coop batteries which will be smaller than if individually owned.
Use your heads a little!!
I agree with the utilities somewhat.. They own the powerlines not you.
Coop is a great idea for consumers. That’s why its not legal in most states. Power company’s have state regs that allow them a monopoly that locks out consumers from interconection
“They own the powerlines not you.” Yes, because they were granted a monopoly! And now that the utility is entrenched they will fight hard against any changes — that’s why you need a Utility Commission that has a spine. I would love to hear how homeowners can form coops and kick out the utility. Here in Colorado, the city of Boulder tried and failed to municipalize their utility.
True. People forget that utilities have NO COMPETITION!! kWh’s exported from rooftop solar are distributed to nearby homes so it’s just a question of measuring. The utilities use lies and propaganda to maintain their profits!!
Just build an “off Grid” System and control your own power. You do not have to pay for what you are not buying.
We’re likely to see similar changes this year here in CA as well, after decades of the PUC rejecting such changes. After 20 years of the same net metering rates, I can understand some adjustment away from utilities paying retail rates for net metered electricity, but if the solar payback period becomes 25 years, rooftop solar will stop dead in its tracks. Any changes should be phased in over a 10-year period or so to allow gradual price reductions of solar panels and batteries to keep the payback period within a reasonable window, say 10-12 years. The utilities are right to want *some* change to adjust for the lower cost of solar now, but they are greedy and want to kill the whole thing.
You don’t think the customers have paid/are paying for that grid? :/
Need federal regulations protecting consumers from anti EV and anti renewable energy HATE legislation. I drive my EV 1000 miles a year and pay an additional $200 fine in Alabama. We have 5kW of solar and pay a $5.41 penalty to Alabama Power for each kW each month. At least they pay use 2 cents for each kWh we put back on the grid and then they bill my neighbors full rate plus fuel and hidden fees.
So my electric bill is just under 6 cents generation and just over 5 cents distribution charge. And that is enough to keep the company paying bills. Then they pay 14 cents a kwh to a guy with a solar system on his house? It sounds like if you owned a restaurant and the government made you give a 55% discount on the meal to all wearing khakis. Soon everyone there is buying khakis and we have a problem.
I have solar so don’t blast me but my solar stuff is used because I’m just wanting to get what I can from it and not pay off 40 grand before the system is wore out too far.
I see the issue is that non solar customers have been footing the bill for revenue lost by the utility for customers who generate power. My bill has a surcharge from the utility company that basically subsidizes them for what little revenue they lose from solar customers. I understand the utility has transmission and distribution cost and that fee should be based on the amount if power used and or generated that feeds into the grid. These T&D fees are ridiculously high. I had a live work location front of building was business the rear was my personal residence. The lines bringing power to building were a single set. Yet my T&D fees on the business account were almost 4x higher then the residential account. Makes no sense! Same power same line to building. Utility companies have been getting away with this type of stuff for far too long. Time to make a change in regulation.
Electricity is easy to generate and store (not historically), right?
If the rates are not enough, sell to someone else.
Electrical generating companies have a monopoly? True. They also have their profits highly regulated (unlike most other companies and, of course, not mentioned in the article).
Saw little discussion of the various facts that surround this controversy.
No mention of how much electricity is lost in transmission!
No mention is made of how much it costs to install and maintain distribution lines.
No discussion of the other critical and expensive components of electrical transmission, aka , the electrical substations.
Everyone can ignore the complexity and cost of installing and maintaining a functioning electrical grid and be easily convinced it must be some greedy company, not some practical reality.
If you only knew what it takes to makes sure electricity is waiting for you when you need it, you would wonder why it doesn’t cost more, not less.
Am only a lowly electrician who builds schools, hotels, stores, residences, restaurants, industrial & medical facilities, etc.
As an IBEW retired inside wireman I agree with you. Solar panels have become so inexpensive, we could generate 2 to 3 kilowatts to the grid and get back just one Kilowatt so the utilitiys could cover their costs. We get to keep everything we generate and use, but using the utilities as our private batteries without paying a premium for their use, is unfair. I built and “Off Grid System before I had my new solar roof installed and the lead acid batteries cost just as much as the solar panels. So why not just double up on the panels, take the discount and make the planet greener? Utilities are building localized battery systems in neighborhoods here in California so they are paying for the storage to keep us powered durring storms and fire storms. We could fill them up with our extra power from our solar panels and get the power back t night or durring grid failures and just give them more kilo watts than we get back rather than pay more fees, higher rates or limiting our solar panel size that many utilities do.
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