While states across the country are considering different solutions to reform liquid energy metering (NEM) to address the higher costs and cost changes caused by outdated liquid metering policies, Dominion Energy South Carolina defended its move this week. proposed solar metering tariff in the state of Palmetto as fair and necessary.
“The reality is that solar customers in our system still depend on non-solar generating sources 75 percent of the time, and it is only right that they share the costs,” Ashley Cunningham, a spokesman for Dominion Energy South Carolina, told Daily Energy Insider.
The South Carolina Energy Freedom Act, which was unanimously passed by the South Carolina legislature and was then signed by Governor Henry McMaster on May 16, 2019 as Law 62, empowers electricity customers to take their own decisions about installing solar panels in their homes or businesses.
And, according to Law 62, Dominion Energy South Carolina was required to submit a successor tariff, which it did, proposing a solar subscription fee and changes in fees for basic service for solar customers, among other items. Dominion’s proposal is currently being considered at hearings this week by the South Carolina Public Service Commission (SCPSC).
“The law was very intentional in its efforts to ensure that customers are not subsidized when solar energy is added to the system – basically, that one group of customers does not pay higher prices unfairly to benefit another group of customers,” said Cunningham. “Dominion Energy cannot generate solar energy on rainy days, but all of our customers – those with solar energy and those without – rely on us to provide uninterrupted service, even when the sun is not shining.”
Dominion Energy’s approximately 11,000 customers in South Carolina who use solar energy on their properties also export a lot back to the grid. This means that about 740,000 non-solar customers must pay for the maintenance of power lines, generation stations and all other associated costs, while also paying for the energy that their utility is producing, explained Cunningham.
“We agree with solar developers about the importance of solar growth in South Carolina, but we can’t forget so many who are struggling financially,” said Cunningham. “We listened to them during our recent fee review and paused this process. These are the same customers we are trying to protect from unfair subsidies. ”
As Cunningham explained, the net measurement tariff of solar choice proposed by Dominion Energy of South Carolina incorporates several charging tools that work in conjunction with the intention of the South Carolina General Assembly in Act 62.
“Existing solar customers will continue to receive individual compensation until the end of 2025 or 2029, depending on when they initially enrolled,” she said. “This period of ownership was also determined by the state legislature in Law No. 62.”
If approved, Dominion customers in the state can choose to put solar energy on their roofs and sign up for the new fee on June 1, 2021.
“With the proposed tariff, solar customers can take advantage of a special time-of-use plan that encourages them to conserve energy,” said Cunningham. “If solar customers are willing to change their consumption patterns and take advantage of the tariff of approximately $ 0.07 / kWh – available to everyone except peak periods – and use their solar energy during peak periods, the economic benefits are clear and there is essentially no difference in the payback periods that people enjoy today. “
Solar energy customers would also benefit from the real value of the energy they export to the grid, said Cunningham. “The more energy the customer uses on site, the greater the benefits for the customer,” she said. “If residential systems are oversized and depend more heavily on export value, the benefits are reduced. This is a great victory for customers who want more freedom and control over their accounts ”.
Opponents of Dominion’s plan, including the Southern Environmental Law Center and the Solar Energy Industries Association, say the utility’s proposed fees could end up costing the average homeowner with solar power on the roof more than $ 750 a year. They also claim that by adding network access fees, a monthly subscription cost and a low export fee for net metering customers, Dominion is inflating solar energy costs and discouraging investments in solar panels.
Cunningham said Dominion Energy South Carolina recognizes that certain stakeholders would prefer solar subsidies to continue in full, but said the law does not allow this.
“Instead, it requires the commission to establish solar choice measurement requirements that fairly allocate costs and benefits in order to eliminate any cost changes or subsidies associated with net measurement to the greatest extent possible,” she told Daily Energy Insider.
The Office of Regulatory Staff of South Carolina agreed with Dominion’s proposal, which is also supported by the Edison Electric Institute (EEI), which represents all of the nation’s investor-owned electrical companies, including Dominion Energy.
“The intent of the original net measurement policy was to encourage early adopters, not to create huge subsidies from one group of customers to another,” testified Adam Benshoff, vice president of regulatory affairs at EEI, during Tuesday’s virtual public hearing. fair about Dominion’s proposed tariff.
“Now that the cost of solar systems has dropped significantly, there is simply no need for these ongoing subsidies,” Benshoff told SCPSC commissioners. “And in states that have seen rapid growth in solar energy on roofs, they have had to develop new policies to reform the net metering to provide continued certainty for the market.”
Benshoff pointed out that South Carolina is one of 14 states that are in the process of transitioning from NEM retail or that have already adopted an alternative compensation mechanism. The reason for this transition appears to vary by state, but there are some common topics, Benshoff told SCPSC.
“Commissions now seem to recognize clearly that the measurement of net energy in retail unjustly compensates customer generators for the services they provide or, more precisely, in the retail structure, for the services they are not providing, such as transmission and distribution services.” he testified.
Some of the incentives originally created in the early 1980s to boost this market, added Benshoff, “are simply no longer needed due to the drop in the price of renewable energy.” And the substantial shift in costs from participating NEM customers to non-participating customers … creates inequalities ”between those who can and cannot afford solar energy on the roof, he said.
“There are several ways to transition the measurement from the retail chain and we are seeing them implemented across the country,” said Benshoff. “THE [Dominion] proposal before you appear consistent with the Law 62 directive to fairly allocate costs and benefits to eliminate that cost change as far as possible. “
Following today’s virtual public hearing on South Carolina’s Dominion Energy proposal, which is scheduled to take place in the early hours of Wednesday morning, the SCPSC will meet again to discuss the proposal on March 24.