Pennsylvania PUC Drops Net-Metering Cap for Alternate Energy Users

The PUC had to change the rules after the state’s Independent Regulatory Review Commission claimed it lacked the legal authority to impose the limit and did not establish a compelling need for it.

by Laura Legere, Pittsburgh Post-Gazette / June 10, 2016

(TNS) -- The Pennsylvania Public Utility Commission adopted a modified version of its alternative energy regulations today and dropped a cap on the size of the customers’ solar and other renewable energy systems that are eligible to sell surplus electricity back to the grid.

The prior version of the PUC rules would have limited the amount of electricity that customers can sell to their utility at full retail rates — a process known as net metering — at 200 percent of the customer’s annual consumption.

The PUC had to change the rules because the state’s Independent Regulatory Review Commission rejected the cap last month, saying the PUC did not have the legal authority to impose the limit and did not establish a compelling need for it.

The review commission also said in its disapproval order that if the PUC decided to delete the 200 percent limit and resubmit the rules, “it should ensure that other provisions of the regulation do not limit a customer-generator’s ability to net-meter excess generation it produces.”

The 2004 Alternative Energy Portfolio Standards Act, which is the basis for the new rules, already sets a capacity limit for net-metered residential systems at 50 kilowatts and caps other systems at three and five megawatts.

The PUC voted 4-0 today to adopt a revision of the rules that struck the single section regarding the 200 percent limit and left the rest of the 148-page order that was originally approved in February unchanged, PUC spokesman Nils Hagen-Frederiksen said.

Rob Altenburg, director of PennFuture’s Energy Center, said the defeat of the 200 percent cap is “a big win for solar owners and operators” but the environmental group continues to be concerned about other aspects of the rule, like its definition of utilities, its handling of potential fees and its requirement that net-metered systems carry an independent electrical load.

He said the independent load requirement restricts homeowners’ ability to put solar panels on separate plots of land instead of on their roofs and limits farmers from putting solar panels in fields away from the properties that hold their barns and equipment.

“We think that’s ridiculous,” he said.

Terrance Fitzpatrick, president and CEO of the Energy Association of Pennsylvania said the utility advocacy group is “mildly disappointed with the way this turned out” but electric utilities recognize that the General Assembly is probably a better venue for addressing these and other policy issues with net-metering.

“There really is a big fairness issue here,” because customer-generators do not pay for the cost of the electricity distribution system like other customers do, he said.

The issue is less acute in Pennsylvania than in other states with broad adoption of solar technology, but Mr. Fitzpatrick suggested there is peril in waiting for net-metering to become more popular before making policy changes.

“Once you get a lot of folks that have these subsidies,” he said, “it gets really hard to fix the problem.”

The PUC’s proposed rules, which have been in development for more than two years, will now be resubmitted to the Independent Regulatory Review Commission for a new review.

©2016 the Pittsburgh Post-Gazette Distributed by Tribune Content Agency, LLC.

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