The renewable energy industry has been a huge boost to the economy and provided much-needed relief to municipal energy grids. However, local utilities aren’t so thrilled with having their profits cut into, and they’re taking action in the state of Kentucky. Legislators are currently debating House Bill 227, which would essentially destroy the rooftop solar industry by getting rid of one of the biggest benefits that the program offers, extending payoff periods and substantially shrinking savings.
Save Profits by Eliminating Competition
For almost 80 years, Kentucky utility companies have had little in the way of competition for their business, and customers really had nowhere else to turn. Today that’s now completely different, as rooftop solar has exploded into one of the fastest-growing industries in the country. However, if legislators get their way, that could quickly come crashing down.
H.B. 227 seeks to destroy one of the largest benefits that solar power can provide: net metering. Net metering is a billing practice which essentially requires utility companies to reimburse solar array owners for the energy they produce and deliver to the grid at the same rate as they would charge for power consumed. For the majority of homeowners, that means their panels are potentially actually making them money during the day to counteract energy consumed at night, when panels aren’t producing. Under H.B. 227, the credit for energy sent back to the grid would be reduced by 65 percent.
Why Would Legislators Do This?
What’s perhaps the most concerning behind this decision is that it really appears to be nothing more than lobbyists for energy companies making use of friendly legislators to try and eliminate their competition. Some companies have argued that net metering has essentially created an environment where those with solar panels on their roofs are “subsidized” by those who don’t through the utility company being require to pay panel owners for the power they send back to the grid. What they don’t reveal is the number of customers who actually receive these credits each month or refund checks at the end of a year-long period.
Representatives Jim Gooch, Matt Castlen, Larry Brown, and Sal Santoro all co-sponsor the bill, and yet none of them, nor have any of the energy companies who support the bill been able to provide any evidence to show that this “subsidy” problem exists. They also haven’t been able to show that these solar arrays are harming the grid, and in fact evidence from many other states has shown exactly the opposite—a large number of solar customers actually benefits the community grid as a whole.
Why is there no evidence for Kentucky’s solar environment? Simple: utility companies and the sponsoring representatives have opposed any plans or movements to analyze the costs and benefits of rooftop solar use in order to figure out its true net influence on the power industry.
The Consumer Energy Alliance
This past summer, at a meeting of the Interim Joint Committee on Natural Resources and Energy, Representative Gooch, the committee’s chairman, allowed generous time to the Consumer Energy Alliance, a marketing and lobbying organization that’s backed by major utility, oil, and gas companies. Despite the fact the CEA was reprimanded by the Federal Energy Regulatory Commission and also by the Wisconsin state government for testifying with false statements, Representative Gooch gave them substantial time. Local solar companies had to specifically request time to refute the CEA’s claims, and were only given about 20 minutes to do so.
What This Means for You
What’s happening in the state of Kentucky is just one example of many different attempts that major energy companies have tried, are trying, and will try in the future to eliminate their competition. With powerful lobbyists and politicians on their side, there’s no telling what could be done in the future, even in spite of the fact of substantial evidence supporting the benefits of solar energy on local grids (or a glaring lack of evidence to show the opposite).
Rather than adapt to a changing market to develop innovative solutions that benefit all customers, local utility companies would rather stifle their competition using the law. This is a dangerous precedent that hopefully doesn’t continue in the future.
For more information about installing a rooftop solar panel array on your home, call Sea Bright Solar today at (732) 253-4052 to request a solar consultation from one of our New Jersey solar installation experts!