A bill that would limit what Kentuckians can earn in the future from excess energy produced by solar panels is back before the General Assembly.
Critics say the bill would be devastating to Kentucky’s fledgling solar industry and directly affect owners of homes and businesses who decide they want to save energy and dollars by installing solar systems.
“We estimate that this bill would reduce the value of solar by over 70 percent …,” said Matt Partymiller, president of the Kentucky Solar Industry Association. “It would destroy the current net metering law, which not only gives Kentuckians the freedom to choose, but that all consumers benefit from.”
Utility companies disagree, saying the measure is a commonsense approach to assuring future solar customers pay their fair share of the costs to maintain Kentucky’s energy grid.
“We encourage renewable energy … but we don’t think it’s fair that we have to pay more (to solar customers) than it costs us to generate our own energy,” said Chris Whelan, spokeswoman for LG&E and KU Energy.
The conflict is over the compensation utilities pay customers under the current practice known as net metering.
When the solar energy system of a home or business generates more power than is needed, the extra power goes back to the power grid for use by others, and the solar customer is credited at a one-to-one rate for the power sent back to the utility.
The bill was filed each of the last two years, but defeated. Last year it narrowly passed the House but stalled in the Senate near the very end of the session.
On Monday, Sen. Brandon Smith, R-Hazard, filed Senate Bill 100, which is a slightly modified version of the bill that stalled last year. Smith did not return a phone message left at his office Tuesday morning.
The bill, like the one considered last year, allows those participating in the current net metering structure to see no change for 25 years. Those who choose to participate within the next year would also be covered for 25 years under the existing law.
But for those installing solar panels after that, the bill would direct the Kentucky Public Service Commission to set the value to be credited to customers for the electricity they feed into the system.
But Partymiller said he believes the bill ties the hands of that commission in considering the total benefits of solar and will result in placing an unrealistically low value for solar.
“The solar industry would see job losses and some newer companies, startups, will close,” predicted Partymiller, who is general manager of Solar Energy Solutions, of Lexington.
Tom FitzGerald, director of the Kentucky Resources Council, said in a news release that SB 100 is a “utility-crafted bill (that) does not represent a fair compromise” to the conflict that lingered over the bill at the end of last session.
Whelan said utilities made several concessions with this new bill. “We feel like under current law, it’s unfair. Those who cannot afford solar, or have regulations in their neighborhood that prevent them, are subsidizing those who do.”
FitzGerald, however, disagreed. He said a 2017 Department of Energy study concluded that the rate impact of net metering customers on other customers is negligible and remains so for the future. The real goal of utilities, he said, is “cornering the market on the sun.”
Partymiller said he’s concerned that SB 100 has been placed on a fast track and will zip through the Senate before it is fully aired.