FRANKFORT, Ky. (AP) — People with solar panels on their homes would get less credit for the excess energy they generate under a proposal moving through the Kentucky legislature.
The measure marks the latest effort to scale back a popular incentive program for renewable energy in this coal-producing state.
People with solar panels on their homes generate their own electricity. Sometimes they don’t generate enough, so they buy power from the utility company like everyone else. Sometimes they generate more than they need and sell the excess power to the utility company for the same price as they bought it, a program called “net metering.” The power company then gives the person a cheaper power bill.
House bill 227 in the Kentucky legislature would let utility companies buy the electricity from residential solar customers at the cheaper wholesale rate instead of the higher retail rate.
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Jamie Clarke, owner of the residential solar company Synergy Home in Lexington, said most home solar systems cost about $20,000, not including federal tax credits. He said it normally takes nine years for a person in Kentucky to recoup that investment. But if this law passes, he said it would take 20 years, making it much harder for people to install the systems.
“The bill is essentially killing residential solar, allowing the utility to maintain a monopoly,” Clark said. “If Time Warner Cable could go back 30 years and make it illegal to put a satellite dish on your roof, what would that do to their business model? That’s effectively what this bill is doing.”
But advocates say the bill seeks to make it fair for people who can’t afford to install solar panels. A power bill is more than just purchasing electricity. It’s also paying for the infrastructure that brings the electricity to the house. By getting a more generous credit on their power bills, industry advocates say residential solar customers are using the grid but not paying their fair share to maintain it.
“We support solar. Don’t misconstrue that. But we have to be realistic about how our grid works,” said Brydon Ross, vice president for state affairs for the Consumer Energy Alliance, whose members include utility companies and others. “We need to think about smart ways to continue to incentivize solar growth. The way we compensate people in that program, frankly, is outdated.”
Similar debates are being held in state legislatures across the country. Thirty-eight states offer “net metering” programs, according to the National Conference of State Legislatures. Since 2015, five states have eliminated those programs and replaced them with something else. In total, seven states — Arizona, Georgia, Hawaii, Indiana, Maine, Mississippi and Nevada — offer something other than net metering, which the NCSL defines as offering full retail rate compensation.
Kentucky could become the eighth state to replace its net metering program, but the bill faces fierce opposition. This is the second year the state’s new Republican majority has tried to pass the bill. But the proposal has had trouble moving through the House Natural Resources and Energy Committee. At a meeting last week, the Republican chairman Jim Gooch abruptly adjourned the meeting before lawmakers could vote on the measure.
But last week, House Republican leadership added three people to the committee — two Republicans and one Democrat — prompting charges the GOP was trying to “pack the committee” to pass the bill.
“It’s just simply not the case,” acting Republican House Speaker David Osborne said. “The chairman was having conflicts, trouble getting a quorum. So, that’s all I’m going to say about it.
Thursday, the bill cleared the committee by a vote of 14-4, with two pass votes and one abstention because of a conflict. The two new Republican members of the committee voted “yes,” while the new Democratic member voted “pass.”