A National Discussion

20+ states are working to ensure fair pricing 

The growth of solar energy, the changing way customers use energy and the need to modernize the electricity grid have stimulated legitimate policy discussions around the country. More than two dozen states are looking at how to update pricing models to reflect the ways customers use the grid.
This section includes news and articles about solar policy issues from journalists, academics and policy makers across the United States.
States Roundup

State Actions taken or under consideration
Arkansas The Legislature made changes to the state's net metering policy in March that more fairly value excess generation for rooftop solar customers and a utility's ability to recover the cost of providing service to solar customers.
California The state’s largest investor-owned utilities and solar advocacy groups filed proposals in August 2015 to restructure net-metering rules for rooftop solar. The California Public Utilities Commission has until the end of 2015 to establish a “NEM 2.0” policy, which will become effective when each utility reaches a 5% net metering cap or July 2017, whichever comes first. The utilities are proposing net metering credits below full retail rates and updated rate design to better align with service costs. Solar groups are seeking to keep the current rules in place until at least 2019.
Colorado The Public Utilities Commission decided in August to make no changes to the state's net metering rules after a year-long series of public meetings. Xcel, the state’s largest investor-owned utility, was seeking to reduce the net metering credit below retail rates so that solar customers share fairly in paying for costs to maintain the grid.
District of Columbia In September 2014, the Public Service Commission released its proposed rules for community net metering, pursuant to the 2013 Community Solar Renewable Energy Act.
Hawaii In June 2015, Hawaiian Electric Companies proposed new customer options and programs for future rooftop solar customers. Among the recommendations include a new net metering credit from the utility, which varies from island to island; a minimum $25 monthly bill; a pilot program with time-of-use pricing; a streamlined and standardized application process; and new technical standards for using advanced inverters. The state Public Utilities Commission will consider the recommendations.
Iowa In January 2014, the Iowa Utilities Board (IUB) began to review its solar policies, including possible changes to net metering and interconnection rules, which currently apply only to the state’s investor-owned utilities. Co-ops and municipal utilities set their own rules.
Kansas H.B. 2101, enacted in April 2014, revised the net metering rules for new systems installed after July 1, 2014. The statute reduced capacity limits for residential and commercial net-metered systems, reduced payment for monthly net excess generation from the retail rate to the utility’s monthly system average cost, and allowed utilities to seek approval to implement time-differentiated rates, minimum bills and other rate structures for customers..
Louisiana The Louisiana Public Service Commission in March 2015 released a study that examines the value of solar PV and net metering in Louisiana. Among its findings, the study says the state’s 50-percent tax credit for installing new solar panels has cost the state $89 million more than the benefits created by the rooftop solar industry.

The state Legislature is scheduled to consider a resolution that would instruct the Maine Public Utilities Commission to develop an alternative to net energy billing through a stakeholder process. The report would be due to the Legislature by the end of January 2016.

Massachusetts A state Net Metering and Solar Task Force created to consider a long-term, sustainable plan for net metering released a final report in April 2015. The report included a variety of approaches that would enable solar to continue growing while addressing concerns about growing cost shifts affecting non-solar customers. A bill to raise the state's net metering cap is being deliberated in the state Legislature.
Michigan Senate Bill 438 proposes modifications to the state's current net metering rules as part of an energy policy reform. Among the recommended changes, homeowners with solar would buy all electricity for their home at retail rates and be credited for all energy they produce at essentially wholesale power prices. An energy policy bill in the House (HB 4297) would maintain present net metering policy.
Minnesota In April 2014 the Public Utilities Commission approved a “value of solar” tariff rate that investor-owned utilities may apply to use as an alternative to net metering. In August 2014, the PUC approved Xcel Energy’s revised Community Solar Garden tariff, which elected to use applicable retail rates, arguing the value of solar tariff was not in the public interest. As of the end of 2014, no investor-owned utility has applied to use the value of solar tariff. In December 2014, the PUC issued proposed rules pursuant to H.F. 729 of 2013. The proposed rules prohibit standby charges to net-metered customers, provide net metering rates, allow meter aggregation and confer REC ownership to the customer-generator.

After a five-year process, the Mississippi Public Service Commission approved a net metering policy for the state in December 2015. Mississippi becomes the 45th state to adopt net metering. The regulators settled on a net metering rate of 7-7.5 cents/kWh, a compromise between rates proposed by utilities and solar advocates.

Missouri A bill was introduced in March 2015 in the Missouri Legislature addresses the state's net metering policy and proposes a comprehensive study of the costs and benefits of solar by the Missouri Public Service Commission. The bill was not considered before the legislative session adjourned in May.
Montana The state Legislature passed a resolution in April 2015 to study the costs and benefits of net metering before considering any more bills related to net metering policy. The Legislature previously rejected five bills during its 2015 session that proposed to expand the state’s net metering program.
New York In December 2014, the Public Service Commission raised the net metering cap from 3% to 6% of 2005 peak demand capacity. The commission also announced plans to advance community net metering and directed staff to develop a net metering successor tariff.
Nevada The Public Utilities Commission voted unanimously in December 2015 to adopt new net metering rules, effective Jan. 1, 2016. Among the changes are: separate rate classes for small commercial and residential net metering customers to ensure no cost shift to other customers; crediting excess net-metered energy at wholesale market rates; an increase to the fixed service charge and corresponding decrease to volumetric energy rates; and an optional time-of-use pricing plan for net metering customers. All net metering customers will transition to the new rate plan by 2020.
Oklahoma Oklahoma Gas & Electric has proposed a new rate structure for customers with rooftop solar and wind turbines that includes a monthly demand charge of $2.68 per kW. OG&E says in its application that the demand for a typical residential user ranges from 6-8 kW. OG&E, which serves 800,000 customers, has about 200 with rooftop solar. The utility says a demand charge will help eliminate the cost shift created by net energy metering. Any new charges for customers with distributed generation must be approved by the Oklahoma Corporation Commission by the end of 2015.
Pennsylvania The Pennsylvania Public Utilities Commission proposed in April 2015 capping the amount of net-metered electricity a system owner can sell to a utility at 200 percent of annual power usage. Regulators say the cap is to ensure that customer-sited systems are primarily serving the customer's on-site load and not taking advantage of net metering rules.
South Carolina Utilities and solar advocates settled on net metering rules that require utilities to implement net metering at the full retail rate for 10 years and prohibits utilities from imposing any solar-specific fees on customers who install panels before 2020.
South Dakota In September 2014, Black Hills Power withdrew a proposal that would have required customer-generators with systems installed on or after October 1 to go on a Residential Demand Service rate schedule that included a $9.75 per kW monthly demand charge.
Tennessee The federally-owned Tennessee Valley Authority (TVA) released its "Distributed Generation - Integrated Value" report, which creates a methodology to determine the value and costs of rooftop solar and other small-scale distributed generation on its system. The analysis shows that solar enables TVA to avoid energy costs for fossil-fuel generation, but overall its calculated value falls below the average retail rate in the TVA service territory and the solar rate currently offered by TVA.
Texas In December 2014, Austin Energy announced increased customer compensation for energy generated under the Value of Solar Tariff starting in January 2015 from $0.107 per kWh to $0.113 per kWh. It will also allow credits from net excess generation to rollover indefinitely instead of expiring.

San Antonio’s municipal utility, CPS Energy, saw healthy response to its SolarHost rooftop solar pilot program. More than 1,200 applications were submitted in the first two days in early September 2015. The SolarHost project enables customers to have panels installed on their rooftops at no cost in exchange for a monthly bill credit. The credit, about 3 cents per kWh of energy generated, will apply for a 20-year period.
Utah In May 2014, S.B. 208 required the Utah Public Service Commission to evaluate the costs and benefits of net metering and to determine a “just and reasonable” rate structure based on the evaluation. The commission held conferences and recently completed a three-day public hearing to consider the cost-benefit analysis and related issues.
Vermont Vermont’s Act 99 required the Public Service Commission to file a report on the impacts of net metering to begin a public engagement on future net metering rule revisions. The report was filed in October 2014, and the commission continues to hold stakeholder workshops.
West Virginia Gov. Earl Ray Tomblin signed a bill in March rewriting the state’s net metering rules to prohibit “cross-subsidization” between solar and non-solar customers, evaluate the costs and benefits of net metering and cap customer-sited generation eligible for net metering at 3% of total utility peak demand. A task force was convened by the Public Service Commission of West Virginia to discuss how to comply with the state law.
Wisconsin In November 2014, the Public Service Commission approved requests by We Energies for future solar customers, creating a monthly charge of $3.80 per installed kW, decreasing the net metering credit from $0.14 per kWh (retail) to $0.03 per kWh (avoided cost) and moving from annual to monthly true-up for excess energy credits. The monthly charge was overturned by a Dane County Circuit Court judge in October 2015, but the other components remain in place.

The commission also approved in December 2014 a request by Wisconsin Power and Light to credit future net metering customers at avoided cost rates instead of retail rates.

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