Utility lobbyists across the US are fighting to repeal net metering laws. They may regret that move, and soon.
Net Metering is under assault in states across the country. Last week, I covered the attempt by U.S. Senate Minority Leader Harry Reid (D-Nevada) and Senator Angus King (I-Maine) to prevent state governments from gutting net metering policies by adding a pro-net metering amendment to the energy bill now stalled in congress. Reid in particular is trying to address the recent blow to the solar industry in his home state. At the behest of the utility industry, lawmakers not only put an end to new net metered projects, but retroactively hammered existing solar projects as well. The anti-net metering outbreak is not restricted to Nevada, though. It is spreading like a plague, driven by the dissemination of model legislation by The American Legislative Exchange Council (ALEC), the Koch-sponsored anti-solar lobbying group.
In Virginia and Indiana, Maine and most recently Iowa are all facing attempts by ALEC affiliated legislators to punish independent solar owners and early adopters. The Iowa bill, House File 2100, was introduced by Representative Dave Heaton (R- Mt. Pleasant) reads in part:
“a. A rate-regulated electric utility that purchases electricity from an alternate energy production facility or small hydro facility pursuant to a net metering agreement shall compensate the facility at a rate that is based upon, and does not exceed, the rate applicable to the rate-regulated electric utility’s wholesale purchase of electricity. b. Net metering agreements entered into prior to July 1, 2016, with an applicable rate that exceeds the rate-regulated electric utility’s wholesale rate shall be subject to a graduated rate reduction whereby the difference between the applicable rate in the agreement and the wholesale rate shall be reduced by twenty-five percent annually over a four-year period.”
In other words, If you based your system financing on the current law of the state of Iowa, just as in the state of Nevada, you are SCREWED, if Heaton’s bill moves forward. For some reason, legislators like Heaton (who is affiliated with ALEC), don’t understand that most rate-regulated, government-sanctioned monopolies are not looking for a free market for energy, but rather to smash competition from independent solar owners.
But what if state lawmakers are convinced to forsake their constituents in favor of their deep-pocketed drinking buddies from the fossil fuel industry? At one time, the death of net metering would be the death of independent, or “Rooftop” distributed solar. But not now.
The Buzz About Batteries
Last year at this time, Tony Stark analog and uber-geek Elon Musk rolled out Tesla’s new “Powerwall” lithium ion storage unit. Sleek, sexy and ready to adorn the home of wealthy enviros, the tech media was atwitter for a longer than average news cycle. I, along with the rest of the solarati, furiously attempted to get our hands on installation manuals, shipping dates, or just spec sheets on the Powerwall, but none were to be had. As quickly as some had cheered Tesla CEO Musk’s announcement, others denounced Powerwall as “vaporware.” None the less, the business is abuzz about batteries, and residential storage looks to be just over the horizon.
In my new year’s preview, Solar Trends to Watch in 2016: The Good, The Bad and The Ugly, I predicted:
“Residential battery storage will not be ready for prime time in 2016. After the Tesla PowerWall hype, it’s going to take a few more years to become reality. Expect a lot of smoke this year- and hopefully we’ll see fire in 2017.”
Tesla is far from the only player in the solar storage game. As they roll out their first commercially-available Powerwalls in Australia this year, German battery maker Sonnen is partnering with Sungevity to make add-on storage available to US solar customers. A Recent market study by researchmoz.us finds that “with the rising demand for PV installations for residential purposes, the market for residential solar energy storage is also rising at a very high pace. The report states that the market is expected to expand at a 67.7% CAGR (compound annual growth rate) between 2014 and 2019.”
Will tearing down net metering drive new independent solar owners into the waiting arms of Elon Musk and his fellow battery buddies? The price is still too high for average consumers, but early adopters who want to give the finger to the utilities that lobbied for the death of net metering will soon have the chance. When demand goes up, supply is soon to follow, and prices will fall, and fall fast for solar storage.
Large utility interests like Warren Buffett and Berkshire Hathaway would love to push rooftop solar indies out of the game and consolidate solar production in large solar generating plants owned by, you guessed it, them. What they are missing is that it isn’t just solar generation consumers want. It isn’t all about global warming for a lot of solar owners. It’s also about CHOICE. Americans don’t like monopolies. They don’t like to be told that they have only one choice of where to buy their electricity. It’s not in our nature to accept what we are handed and get back in line.
We are at the dawn of a new era. Soon enough, we might find that battery storage has made net metering obsolete. Perhaps we will no longer need to bank our excess power with the utility company. And when that time comes, utility companies are going to pine for the days of net metering. They are going to wish that they had been forward thinking enough to appreciate the peak shaving and system resilience that distributed solar could have provided them, had they only embraced it.