Connecticut bill may cut electricity costs but stymie solar

A bill touted to reduce Connecticut’s high energy prices is receiving both praise and backlash after it was introduced late in Connecticut’s legislative session. Critics argue it is based on the false premise that homeowners with rooftop solar hike up prices for those without, and will stymie both residential and utility-scale solar buildout.

Connecticut’s high electric prices are the cornerstone of the legislation. At 30.06 cents per kWh, Connecticut has nearly double the U.S. average for its residential electricity rates, according to the U.S. Energy Information Administration.

Within SB 1560 is a proposed change to Connecticut’s net metering. The change would allow residents with solar installations to only receive credit for the excess power their system generates. Currently, the costs of distribution or transmission are part of the calculation that determines how much homeowners are compensated for excess power.

The bill received testimony from 162 organizations and residents opposing the bill, and 26 in favor.

Utilities that support the bill’s provision said as more customers install solar panels and purchase less electricity from the grid, the cost to maintain transmission wires, utility poles and other infrastructure has remained the same. The utilities argued that this has forced them to increase prices for customers without solar panels.

“The fact of the matter is that we have a declining sales base and a need to continue to invest in the system,” Doug Horton, the vice president for Eversource’s rate and regulatory requirements said at the hearing. Horton said Eversource sold roughly the same amount of electricity, about 20,000 GWh, to its customers in 2024 as it did in 1993.

Valessa Souter-Kline, the northeast regional director of Solar Energy Industries Association (SEIA), objected to the bill’s characterization of solar adoption as solely a cost shift. “In fact,” Souter-Kline said in her testimony, “solar and storage provide significant value to the grid by reducing the need for costly distribution upgrades, reducing peak loads and reducing greenhouse gas emissions, a stated objective of this bill.”

Even under the most conservative estimates, Souter-Kline said “no cost shift is associated with residential solar net metering until solar exceeds 10% of total electricity use, and Connecticut’s penetration rate is currently at just over 4% — well below what might otherwise create an impact on non-solar customers.”

Charles Rothenberger, an environmental attorney and director of government relations at Save the Sound, an environmental nonprofit that opposes the bill, said, “While increased electricity sales as a result of load growth will have a downward impact on rates, that should be balanced against the cost of any distribution and transmission investments that will need to be recouped to meet load growth past a certain threshold,” he said in his testimony. “Accordingly, the goal should be to plan for and manage load growth responsibly while identifying the most appropriate generation resources to meet increased demand, activities.”

The bill would also make existing nuclear power eligible to earn renewable energy credits (RECs) by defining them as a Class I renewable energy source. Under Connecticut’s current standard, only nuclear energy commissioned after October 2023 has Class I renewable energy status.

The purpose of providing financial incentives for this designated class is to promote clean energy adoption and deployment, lowering the emissions from Connecticut’s electricity supply. Utilities must buy RECs to offset a certain percentage of the power they sell. This not only helps the state lower its emissions, but supports new renewable energy buildout because developers can use the money they earn from selling the RECs to finance new clean energy projects.

Souter-Kline criticized the measure to change the existing Class 1 framework, saying the nuclear industry is not in crisis or in need of additional financial incentives. “Yet such a designation would create an existential threat to the entire renewable energy market in Connecticut, destroying an industry that provides significant cost saving to customers and employs many thousands of well-paid workers in Connecticut.”

“Existing nuclear power has always been expressly excluded from the Class 1 designation because the size and scale of nuclear energy in Connecticut would dwarf the rest of the renewable energy market and render financial incentives such as the renewable energy tax credit worthless,” Souter-Kline said.

Solar made up 4.21% of Connecticut’s electricity last year, according to SEIA. For comparison among its bordering states, solar accounts for 24.63% of Massachusetts’ electricity; 13.94% of Rhode Island’s electricity; and 5.28% of New York’s electricity. The Constitution State is ranked 29^th for its per capita residential solar installations, and 13^th for its residential solar capacity. According to SEIA, 10.7% of Connecticut homes have solar.

Authored by Sen. John Fonfara (D), the bill was introduced late in Connecticut’s legislative session, which is one of the few states that does not impose deadlines for introducing bills to its House and Senate. The state’s legislative session adjourns June 4.

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