By Jesse Berst
I believe the proponents of rooftop solar are going overboard with nonsensical conspiracy theories that paint utilities as evil overlords. But we have to be careful that we don't fall into a similar trap. It's hard to fling dirt without getting your hands dirty.
Rather than resort to Chicken Little protestations or rearguard legal actions like those described in a recent article from the New York Times, I think utilities would be wiser to seriously investigate getting into the solar business themselves. I concur with NE Energy CEO Michael Yackira, who told the Times "I see an opportunity for us to recreate ourselves, just like the telecommunications industry did."
That New York Times article claims electric power utilities are "in almost panicked tones... fighting hard to slow the spread" of rooftop solar.
In fact, most utilities are not fighting hard enough. But the battle is not to slow solar energy. The battle is to stop subsidizing the (mostly rich) homeowners and business owners who can afford rooftop solar. Otherwise, the U.S. could find itself in the same position as Germany, which is considering a retreat from renewables because its subsidies made electric power too expensive.
The author quotes EPRI veteran Clark Gellings as saying: "We did not get in front of this disruption. It may be too late."
The battle is playing out among energy executives, lawmakers and regulators across the country, but especially in Arizona and California, where solar penetration is high. California is home to the nation's largest solar market and most aggressive subsidies. Its decisions will create a template for other states and countries.
At the heart of the fight is net metering, available in 43 states and the District of Columbia. It pays customers retail rates for the solar power they send back to the grid. Because those customers get the retail rate, they pay nothing toward the expenses of keeping the grid stable in the face of fluctuating solar supply or the costs of being the "backup system" for those customers when the sun is down.
California utilities are awaiting the result of a study to determine the costs and benefits of rooftop solar to both customers and the utilities with an eye toward retooling California policy. In California, the amount of solar installed each year increased by 160 percent from 2010 to 2012.
"The next six to 12 months are the watershed moment for distributed energy in this country," said Edward Fenster, CEO of solar provider Sunrun.
Jesse Berst is the founder and Chief Analyst of SGN and Chairman of the Smart Cities Council, an industry coalition.