The solar energy boom in Massachusetts has been exciting and there is little debate over whether further expansion is important. We are strong supporters of solar energy, but only at the right price for the state’s businesses, municipalities, and residents, including low-income customers. It is they — not utilities — who are shouldering the high cost of electricity produced by solar power.
As the conversation about how to finance the future of solar energy in Massachusetts continues, it is important to set the record straight about what maintaining the status quo — or raising the net metering cap — means for utility customers statewide, as well as what it means for solar developers.
Net metering – one of the state’s solar incentives – rewards solar energy owners or developers by paying them for the power they produce at the same rate they would pay if these owners and developers were consuming electricity from the grid. This rate includes payment for benefits and services that solar developments do not provide. In addition, when solar sites produce more than they consume, they don’t have to pay for services such as the use of the wires and poles operated and maintained by the utility and financed by utility customers. For large solar projects, these reimbursements far exceed the value they bring to the electric system. As a result, Massachusetts pays more per kilowatt-hour of solar energy than anywhere else in the nation, and about twice as much as neighboring New England states.
This leaves utility customers who do not have solar with a grossly inequitable share of the burden of Massachusetts’ overpriced solar energy. Given this structure and steep subsidies, it is no surprise that developers are feverishly pushing for an increase of the net-metering cap.
The Net Metering Task Force, on which we served, estimated that nonsolar customers will pay nearly $4 billion between now and 2020 if current policies remain in place. That is unfair and unsustainable.
We support the creation of new policies that continue to promote the expansion of solar energy in Massachusetts without forcing nonsolar customers to subsidize millions of dollars in profits for developers.
In the meantime, we believe that raising the cap is not needed to ensure the ongoing development of solar power installations. This is evidenced by the applications — for systems of various sizes — that National Grid continues to receive even after meeting its cap. The cap does not apply to residential projects or those that produce electricity to be used exclusively on site. In addition, net metering is not the only incentive for
Let’s not rush to strap customers with paying for additional subsidies for the solar power industry before we shine some sunlight on the real costs and benefits of solar for everyone in the state.
Bob Rio is senior vice president of Associated Industries of Massachusetts. Amy Rabinowitz is deputy general counsel for National Grid. Camilo Serna is vice president of strategic planning and policy for Eversource.