During the past eight years, solar policy in Maine has been a polarizing topic in Augusta. Entering Gov. Paul LePage’s first term, solar rebates were available for residents and business owners. The state’s net metering policy, which requires our biggest utilities to provide a full credit for every kilowatt-hour delivered to the grid, was fully intact. The deliberations that have occurred since have been highly public, complex and contentious.
In 2016, a broad coalition introduced a bill that would have proactively replaced net metering with a complex mechanism. Following the failure of that bill, the Maine Public Utilities Commission enacted changes to the state’s net metering rules to reduce benefits for solar customers who send excess power to the grid. The Legislature made two attempts with bipartisan bills to amend these changes in 2017 and 2018. Ultimately, those efforts failed in the Maine House of Representatives, where the governor’s vetoes were sustained by margins of just a few votes.
On March 16, 2018, Maine’s net metering era ended and was replaced with a new mechanism commonly referred to as “gross metering.” Under net metering, solar customers received credits based on the energy that was exported to the grid and measured by the existing utility meter. With the new gross metering program, credits are based on the total amount of energy the system generates even if the power doesn’t enter the grid. New meters — paid for by ratepayers — are required to accomplish this. Gross metering invests ratepayer dollars to recover benefits that would otherwise have been received by solar customers under net metering.
The value offered to ratepayers by the installation of these gross meters has been a significant source of conflict. Solar supporters point to a Public Utilities Commission study and argue that a reduction in benefits to solar owners actually reduces the benefit received by all ratepayers. Conversely, the governor’s office argues that the reduction in benefits doesn’t go far enough. When the new gross metering rules were introduced, both parties were highly critical of the commission’s decision.
After six months of life under the new gross metering rules and after over a year of stakeholder discussions to determine how to effectively implement them, we are now in a better place to assess how well the new rule accomplishes its original objectives. Namely, we can begin to answer the question: do the benefits of gross metering outweigh the costs of installing the additional meters?
On Oct. 29, our company, Insource Renewables, submitted information to the commission related to this question. We have been installing gross meters and working alongside other solar companies, the commission and the utilities to determine how to best implement these new rules. Our submission to the commission detailed the costs associated with the installation of the additional meters and the trends we are seeing related to ratepayer costs and benefits.
We have discovered significant differences between the initial estimates provided to the commission by Central Maine Power and the actual costs associated with implementing the program. Generally, the costs of installing additional meters appear to be three to four times the initial estimates, and the benefits are roughly 30 percent less than assumed. For specific commercial applications, the benefits received by ratepayers were overstated by a factor of 40 in the initial estimates.
While this information may further fuel conflict between parties involved in these deliberations and lead to finger pointing with regards to who deserves the blame, the intent of our filing is to help Maine take immediate steps to avoid the costliest parts of the new gross metering rules and to gather information to accurately assess ratepayer costs and benefits.
Under gross metering, solar installed in the near term still provides significant cost savings to new solar owners. Solar also has a great deal of value to offer the people of Maine through energy savings, increased power reliability, avoided transmission investments and local economic development.
As we prepare for a shift in leadership in the Blaine House, we have the opportunity for a new path forward. Maine benefits most when we use our differences in perspectives and expertise to collaboratively address Maine’s issues. This type of approach encourages us to implement energy development in a manner that provides the greatest value to the state. The lessons we can learn from the last eight years will help better inform these discussions moving forward.
Vaughan Woodruff is the founder of Insource Renewables. He lives with his family in Pittsfield.