Montana will delay action on net metering until a study of its impacts is complete

Dive Brief:

  • Supported by NorthWestern Energy, Montana’s dominant electricity provider, state lawmakers are moving ahead on a resolution requiring a comprehensive study of rooftop solar’s costs and benefits before any law on net energy metering (NEM) is debated.
  • Senate Joint Resolution 12 requires the study to include research on NEM’s cost-effectiveness, on what its cost impacts are to non-solar owning utility customers, and on NEM’s overall utility bill impacts. The committee is also required to study solar’s fixed and operating costs, NEM’s impacts on energy and capacity supplies, solar integration questions, and reliability and safety issues.
  • A report on NEM in Nevada for its Public Utilities Commission found reduced incentives in 2014 made self-generation with NEM slightly more expensive than grid electricity, but 2015’s improved incentives made it slightly less expensive over 25 years. The study also concluded non-solar owning customers would not be harmed. 

Dive Insight:

NorthWestern Energy, which serves nearly all the state’s net metered solar owners, is concerned about a possible cross-subsidy. When solar owners’ kWh charges drop because of their systems’ production, the fixed charges that cover grid maintenance costs drop proportionately, imposing those costs on non-solar-owning customers.

The Nevada study found there is no cost shift because "the utility will avoid purchasing 2.45 kWh of central station renewables on behalf of all customers for every kWh of NEM generation from 2004 through 2015."

At the end of 2014, 44 states, Washington, D.C., and 4 U.S. territories had authorized NEM, according to the National Conference of State Legislatures (NCSL). Texas and Idaho allow utilities to provide NEM voluntarily.

The Solar Energy Industries Association Net Metering Guidelines include rights to self-generate and grid-connect, the right to properly valued and compensated solar, and the rights to equitable cost recovery, statewide application, and transparent data access.

Filed Under: Generation Solar & Renewables Distributed Energy Regulation & Policy