As Kearsarge Solar Campaign Nears Deadline, Limit On Incentives Causes Uncertainty

Jan 30, 2015

Credit Julian- / Flickr Creative Commons

The New Hampshire Electric Coop will soon be the first utility in the state to fulfill a state-mandated requirement on how many customers are allowed to sell their solar energy back onto the grid. This has led some potential solar customers concerned about whether they will recoup their investment to bring their complaints to the Coop’s Board of Directors.

To get what this brouhaha is all about, you first have to know what net-metering is.

When customers with solar panels generate electricity but don’t use it, net-metering is a policy that requires utilities to buy that energy for the same price they charge the customers. Customers don’t tend to earn money, but can cover the cost of their bill.

“Net energy metering has basically been the bed-rock of the economics for residential and commercial solar, all across the US in every state that has any kind of a meaningful solar market,” explains Shayle Kahn, Vice President of Green Tech Media - a sort of trade journal that covers the renewable energy industry.

More than a decade ago state lawmakers passed a law saying every utility in the state has to net-meter, but only up to a cap of 50 megawatts. Those 50 megawatts are shared out between the various utilities according to their size. There is a bill before the legislature this year that would more than double that cap, but there’s no telling if it stands a shot of passing.

The New Hampshire Electric Coop is about to hit its cap of 3.16 megawatts.

'Faster Than We Anticipated'

In many ways the utility is a victim of its own success. Of the four utilities in the state it gets the highest percentage of its energy from renewable sources, and thanks in part to a solar incentive it makes available to only Coop customers, it has proportionally much more solar power in its territory as well. While other utilities are at something closer to 20% of their caps, the Coop is only about twenty homes shy.

This all kind of snuck up on them.

“It happened faster than we had anticipated it was going happen and we’re trying to deal with it now,” said Judy Gove, Vice Presidents for Business and Government Affairs at the Coop, in a presentation to the board of directors Thursday. “Unfortunately that doesn’t help our members make decisions today based on the uncertainties,” she concluded.

In the fourth quarter of last year the number of solar installations in Coop territory – mainly in the north-central part of the state – jumped by more than four times the average rate since 2010.

This means it’s in uncharted waters. It doesn’t have any obligation to buy any energy from customers who come in after the cap.

Net Metered Solar on NHEC Grid | Create infographics

Solarize Kearsarge

This uncertainty couldn’t come at a worse time. These questions have arisen just as a solar energy promotion is nearing its deadline for completion.

The campaign is called Solarize Kearsarge, and it’s the second Solarize effort in the state. It’s a push for a big group of homes in a few towns – Wilmot, Andover and New London – to put solar on their roofs at the same time. The more people sign up, the cheaper everyone’s project becomes. The first effort, in the Upper Valley, signed up 120 customers.

Brad Hardie is a firefighter from Andover who just signed a contract for a $40,000 solar array on his house through Solarize Kearsarge. He came to a meeting of the Coop’s Board of Directors to air his concerns.

“What about all the other people who have put thousands and thousands and thousands of dollars down? What’s gonna happen to them? What’s going to happen to my investment?” Hardie asked the assembled board, “And what are you guys going to do to at least protect those customers?”

Solarize Kearsarge has signed up 29 customers so far, 19 of which are in Coop territory. With their capacity alone, the Coop will bump right up against its net metering cap.

And with just a few days to go, 20 more customers are still on the fence. Since it came out that the Coop was close to its cap, those customers aren’t at all sure what to do.

“They’re putting us in an impossible situation. Would you as a home-owner commit to a purchase if you didn’t know what the terms of the deal were going to be?” says Jack Ruderman  with Revision Energy, the company that’s installing all of those panels.

Net-Metering 2.0?

The Coop is making an effort to provide some certainty. It has voluntarily added a buffer onto the cap, another 240 kilowatts, which should be enough to accommodate all of the Solarize customers, but not if any major projects from other installers come along.

But the problem for folks like Hardie, is that it’s when the panels get installed that you make it under the wire.

“My system’s not going up until August, or September. What am I supposed to do?” Hardie asks, “I can tell you that I’m not going to just roll over.”

He wants some sort of queue to know who’s made it in and who hasn’t or a deadline before which everyone is allowed to net-meter.

The Coop’s board said they’ll think about that.

But more broadly, the board says the current structure of net-metering isn’t sustainable in the long-term. The more successful its program gets, the more money non-solar customers are being charged. Under net-metering solar customers aren’t paying their “delivery charges,” that’s the half of the electric bill that pays for the poles and wires.

That means that non-solar customers have to pick up the slack, however small it may be.

And in the words of Ken Colburn, a member of the Coop Board of Directors, their ultimate goal is for nobody – solar panels or not – to “get screwed.”

“There are a lot of utilities out there that are saying, ‘oh my god, we’ve got to stop this’” says Colburn, “and that’s not the position of the New Hampshire Electric Cooperative.”

The board said it would meet with customers on February 11th to hear their concerns, and come up with a new net-metering rate, which will be ready by March. Several possibilities for what that rate would look like were floated during the meeting, and included a solar fixed charge, solar rates that changed during on and off-peak hours, and a so-called “feed in tariff.”

And as the first New Hampshire utility to confront this question the others will be waiting to see what it comes up with.