Net Metering in Limbo in Both Mass. and R.I.

By TIM FAULKNER/ecoRI News staff

Net metering continues to hang in the balance in both Rhode Island and Massachusetts.

Massachusetts has had much success since establishing net metering as the centerpiece of its renewable-energy incentives. The state consistently ranks in the top 10 in the United States for solar energy per capita. Also, an estimated 15,000 workers are employed in the state’s solar sector.

Demand for new solar projects has been so great that a year ago customers in National Grid’s service area hit a cap for new commercial and utility-scale solar projects. Efforts to raise the cap have stalled in the Massachusetts Legislature. Things got worse in February when the state solar energy renewable certificates (SRECs) program reached its limit, and no replacement has been announced. SRECS are sold by owners of solar systems to utilities. Utilities use the energy credits to meet their renewable-power mandates.

On March 14, mayors from 32 cities and towns in Massachusetts, including Fall River and Brockton, sent a letter to legislators asking them to oppose two bills that raise the net-metering cap but require utilities to compensate solar customers at the wholesale rate rather than the current, and typically higher, retail rate. They also oppose a new monthly fee, called a “reliability contribution.” The letter noted that similar changes in Nevada led to the loss of 1,200 renewable-energy jobs in that state. Another March 14 letter, signed by more than 100 House members, likewise urges opposition to the legislation.

A component of net metering, virtual net metering, helped larger solar projects flourish. Called shared solar, community solar or solar gardens, virtual net metering has brought solar power to low-income communities, renters, and those without a sunny roof or room for solar panels. 

Utilities such as National Grid and Eversource Energy don’t support shared solar and net metering in general because, they say, they lose revenue when solar customers are compensated for putting power into the grid rather than buying it. The utilities argue that offsite power generation gets a free ride on the wires and utility polls by not paying maintenance fees and other charges that standard electric customers pay.

Supporters say net metering and virtual net metering bring locally generated power directly to the grid, thereby reducing the cost of acquiring electricity and delivering it to customers. Solar power also generates less pollution, curbs carbon emissions and creates jobs, they say.

“The claim that net metering is a subsidy to renewables,” said Rhode Island Rep. Aaron Regunberg, D-Providence, “has no basis. There is no evidence for that. If anything, it is the customer of the net-metered system that is subsidizing the utility, not the other way around.”

In Rhode Island, virtual net metering is permitted for state agencies, quasi-state agencies, municipalities and the Providence Water Supply Board. A bill sponsored by Regunberg would expand virtual net metering to all electricity customers, including those who can’t pay for solar and other types of renewable energy.

“From every perspective we should want to see more (net metering),” Regunberg said during a recent House hearing.

Renewable-energy developers in Rhode Island have wanted virtual net metering for several years. Advocates say allowing residential customers to participate opens up a vast market, as only about a quarter of roofs in Rhode Island are suitable for solar.

Developer Julian Dash guided West Warwick, R.I., through the process of buying into three wind turbines being built in neighboring Coventry. By using virtual net metering, the project is expected to save West Warwick up to $40 million in utility costs. Central Falls will save between $7 million and $10 million for a mix of offsite solar and wind projects, according to city officials.

Virtual net metering is simply a policy construct, Dash said. “It doesn’t require any funding from the state and it doesn’t impose any impacts on ratepayers," he said.

Regunberg’s net-metering bill goes up against Gov. Gina Raimondo’s proposed Article 18 of the state budget. The governor’s suite of energy initiatives is favored over Regunberg’s bill by National Grid, the state Office of Energy Resources and the Public Utilities Commission (PUC). 

Regunberg said his bill creates more opportunities for virtual net metering than the governor’s budget article. He recently spoke with Raimondo about making the programs align.

“As we are transitioning to a clean energy economy, we can’t leave anyone behind,” he said.

The PUC said Regunberg’s bill may conflict with federal laws and existing state programs. It recently opened a docket to address the costs and impacts of existing renewable-energy incentives, along with those programs being proposed or expanded.

Betsy Stubblefield Loucks, of the nonprofit housing advocates Green & Healthy Homes Initiative, said low-income families spend about 20 percent of their income on utilities, compared to 3 percent for the rest of the income scale. A review by the PUC is unnecessary, she said, as other states have already addressed the same issues.

“I don’t see any reason why we don’t just move forward with (virtual net metering),” Stubblefield Loucks said.

Regunberg's bill is supported by International Brotherhood of Electrical Workers and Teamsters Local 251.

Three Rhode Island-based solar installers said they do most of their business in Massachusetts building virtual-net-metering projects and they want to branch out in Rhode Island. Renewable-energy developer Fred Unger installed 80 solar projects in Massachusetts, almost all for low-income housing.

Unger said the governor’s net-metering plan has too many requirements and restrictions. “What (Regunberg’s) bill does is basically make net metering fair and available for everybody,” he said.

Regunberg also sponsored a bill that would have the PUC, the Division of Public Utilities and the Energy Facilities Siting Board add considerations for climate change and pollution to their mission and decision making.

“Those decisions have a big impact on issues that go beyond electricity rates, beyond utility profits," Regunberg said. "Obviously, they impact the climate, they impact the health of our communities, they impact the environment of our state, they impact our local communities.”

That bill is opposed by National Grid, Providence Water and the PUC.

Cindy Wilson-Frias, PUC’s senior legal council, said she wasn’t clear how the PUC would implement these changes.

“We can approve funding for projects. We can’t tell the utility how to do their job,” she said at a March 8 hearing.