State commissions take varying approaches to net metering regulation

Net metering was the topic at last week's Florida Bar program, sponsored by the Administrative Law Section and the Environmental and Land Use Section.  Autumn Proudlove of the NC Clean Energy Technology Center described the various state approaches.  She said there are 2.7 million net metering customers in the U.S.  There is the concern about cost shifting to the remaining ratepayers; and there is the opposite concern about benefits not being fully accounted for.  There are efforts to become more granular in solar valuation.  27 states are looking at changes to net metering.  Some are considering changes to the credit rate.  California is considering time-of-use rates. Vermont is looking at a credit rate adjuster.  Connecticut, Idaho, and New Hampshire are undertaking studies on net metering.

Brad Harris of Duke Energy described the negotiated settlement on net metering reached in South Carolina.  It entailed one year of negotiation.  The methodology has no netting -- every kwh served to customers is billed.  They took into account environmental benefits and economic development.  They developed a new time-of-use rate.  Harris said you can't bypass certain costs.  They looked at how to make net metering more of a reliable resource.  They count solar as energy efficiency, and charge a grid access fee for amounts above a set threshold.

He said the negotiation involved engaging early, involving willing and genuine participants, and hearing their needs.  Also, the utility had to be clear about the constraints they were working under.  He said some of the biggest players in the state were involved from the renewable and environmental communities..  The settlement agreement included Duke Energy, Vote Solar, North Carolina Sustainable Energy Association, Sunrun, Solar Energy Industries Association, Alder Energy, and the Southern Environmental Law Center on behalf of the Coastal Conservation League, Upstate Forever, and the Southern Alliance for Clean Energy.

Lisa Edgar, former Florida Commissioner and Chairman and currently at the University of Florida College of Law, described the rulemaking process used in Florida to develop the net metering rule back in 2008.  The results are that there were 59,500 connections for customer-owned renewables in 2019 and 71,000 in 2020.  She thinks a more granular approach would be good.  Also, it would be good to minimize the cost for customers attempting to interconnect to the utility.  She stressed that net metering is a billing methodology.  The Florida definition is "a metering and billing methodology whereby customer-owned renewable generation is allowed to offset the customers electricity consumption on site."