Standing by Net Energy Metering

John Wood, Jr.
2nd Vice-Chairman of the Republican Party of Los Angeles County, and is a former Republican nominee for congress in the 43rd district of California

It’s no secret; for whatever arguments one might make regarding the effectiveness of solar energy in delaying man-made climate change, or the broader market viability of renewable energy technologies, the fact is that solar electricity has become a significant part of the energy economy in states that have supported aggressive incentives for solar investment. Solar energy has become a significant factor in economic growth overall for states like Nevada, New Jersey, Hawaii, Arizona, and certainly for the state of California.

California boasts the highest cumulative solar electricity capacity in the United States, adding more capacity per person in 2014 than any other state. Solar electricity usage currently accounts for 5% of the state’s overall electricity usage, yielding cost savings for consumers, and secure, well paying careers for workers (54,680 in sales and installation in California alone). For both workers and consumers, the advent and proliferation of residential solar power has been a profitable development.

Unfortunately, the continued growth of the solar industry in California is at risk from changes in the relationship between solar consumers and utilities currently being pushed by some of California’s major utility monopolies. The growth of residential solar in California has been made possible by the “Net Energy Metering” program, whereby owners of solar panels are able to sell the electricity generated through solar panels in excess of that which the user consumes back to the utility for resale, as the electricity returns to the same power grid that both solar electric and conventional electricity consumers in a given area utilize. Because of this set rate purchase, it is easy to project energy cost savings to home owners utilizing solar panels, most of whom lease in order to minimize their electric costs.

Now, some major utilities wish to end the energy metering program, instead wishing to put in place a new system whereby residential consumers are charged extra for “peak electricity use” during periods of time exceeding 15 minutes…regardless of their overall level of usage for the month (a billing practice residential electricity users of any kind are not now subject to), making savings impossible to project, and lessening or eliminating the benefit of solar power to users, even though they are not acquiring electricity through the utility to begin with.

The benefit of this policy to the electric monopolies seems to be clear: reducing savings available to solar customers will reduce solar customers, leading more people back into the conventional electricity market. After all, solar energy does represent competition to traditional providers, and any business must be expected to do what it legitimately can to win out over competition.

Yet, these major utility companies are in the privileged position of possessing enormous regional monopolies over captive markets that have never had a choice of energy providers before. The energy market is not a “free” market therefore to begin with, but the introduction of a renewable energy alternative like solar introduces the element of choice to the consumer, which is something that all people who value the health of the marketplace ought to support.

It is understandable that the major electricity monopolies would want to protect their control of the energy marketplace. Californians however, ought to support the interests of workers, consumers, and choice in the marketplace, by standing in support of the Net Energy Metering program.

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