Georgia Power company, an electric utility, has announced a proposal to impose an interconnection fee to rooftop solar customers in its territory. The proposal would include a $200 charge to attach renewable energy to the electric grid.
Also included in the proposal is the plan to increase bill rates that would increase monthly costs by an average of $16.29 per month.
Georgia Power cited a “cost shift” on non-solar customers by rooftop solar customers as the reasoning behind the new proposed interconnection charge. The “cost shift” is a utility anti-rooftop solar concept that utilities keep in their playbook as a justification for raising rates and increasing profits. The argument is that rooftop solar programs lead to a cross-subsidization of solar customers by those who have not yet adopted the technology.
It has been demonstrated in numerous state and national level studies that the “cost shift” is negligible, and that rooftop solar instead provides cost and resilience benefits for the grid at large. Lawrence Berkeley National Laboratory (LNBL) determined that distributed solar “entails no more than a 0.03 cent/kWh long-run increase in U.S. average retail electricity prices, and far smaller than that for most utilities.”
The analysis also found that at 10% of the energy mix, distributed solar yields between a 5% decrease and a 5% increase in retail electricity prices. Georgia is nowhere near this figure, as the Solar Energy Industries Association (SEIA) reports that solar in all forms in the state represents only 0.05% of electricity generation in the state.
“When utilities feel threatened by customers choosing solar and exercising their energy freedom, all ratepayers get squeezed,” said Kevin Lucas, SEIA’s senior director of utility regulation and policy. Lucas is the lead author on a joint testimony released by SEIA and Vote Solar.
The testimony calls for Georgia’s Public Service Commission (PSC) to reject the $200 interconnection fee for solar customers. It also encourages the PSC to strengthen its oversight of utilities to prevent over-collection from ratepayers and empower customer choice.
“Georgia Power Company has been over-collecting from Georgian’s electric bills by an average of $26 annually over the last 11 years. These excessive charges add up to $1.87 billion in additional revenue for the utility at the expense of all Georgia residents and businesses. If that wasn’t enough, GPC is now asking state regulators to approve more rate hikes and rate structure changes that will penalize solar customers and eliminate choices for ratepayers to control their bills,” wrote Lucas.
SEIA’s analysis showed that Georgia Power’s over-collection charges peaked in 2020 amid the COVID-19 pandemic, leading to nearly $500 million in additional revenues. Alongside the mid-pandemic rate hikes was Georgia Power’s decision to disconnect 131,000 customers from electric service.
“Georgia families are already feeling the strain of inflation, and Georgia Power’s rate hikes are both needless and exorbitant,” said Allison Kvien, Southeast regulatory director at Vote Solar. “The Public Service Commission has an opportunity to protect the rights of ratepayers to choose solar for their homes of businesses.”
The U.S. Department of Energy cited solar soft costs as a major barrier to the clean energy transition. Soft costs represent any part of a solar project not directly linked to hardware costs, and include costs like marketing, permitting, inspection, and interconnection. Soft costs are significantly higher in the U.S. than much of the world, and Georgia Power’s proposal would only exacerbate this problem further.
The joint testimony sent to the Georgia PSC can be read in full here.
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