LePage Proposes End to Solar Net Metering Program

Jul 25, 2016

Gov. Paul LePage is proposing a three-year “grandfather” period to allow Maine residents who have installed solar panels to recover some of their upfront investment through a practice called net metering. After that, he wants to end the program. The governor’s new proposal is drawing swift criticism from the solar industry.

Under net metering, residential solar generators can get a credit on their electric bill for excess electricity that they put back into the power grid. Over time, those credits can help cover the cost of the original investment, for, say, solar panels.

But as more people have gone solar, the policy has come under fire, with some saying it forces nonsolar customers to pay an unfair share of maintaining the electric grid.

LePage wants to get rid of net metering altogether.

“The whole concept behind the comments from the governor’s energy office is to move forward with a more market-based approach,” says Patrick Woodcock, who directs the governor’s energy office.

Woodcock submitted the new proposal to regulators at the Maine Public Utilities Commission on Friday. It offers a three-year phase-out of the decades-old net metering regime, starting in September. After that, the governor would still allow solar generators to be compensated for excess energy, but at rates Woodcock says would more closely track the real-time value of electricity in the region.

“And what the three-years is trying to do is they will receive, effectively, the retail price price of electricity and move forward with a new compensation system. They would be able to receive the renewable energy credits that have a huge value - they are currently not receiving that,” he says.

But solar power advocates say the governor’s proposal would compound harm that uncertainty over net metering’s future is already causing the industry.

“A crock of lies and misperceptions and misinformation,” says Steve Hinchman, the chief financial officer at Portland-based solar contractor ReVision energy, characterizing LePage’s proposal. “It’s really disheartening.”

Hinchman says the governor’s office overlooks benefits that local solar power production provides to all electricity consumers, such as reducing energy demand on their grid at peak times, which puts a brake on spot-market electricity prices. Such benefits were documented in a “Value of Solar” report commissioned by the PUC less than two years ago, and recently updated.

“The governor’s entire position is predicated on the idea that solar is too expensive. The opposite is true. Solar is saving ratepayers, it’s lowering their energy use, it’s reducing carbon emissions, it’s creating high-quality jobs,” Hinchman says.

Many residential solar users want net metering to be continued at least until the next Legislature can make a new try at consensus. A decision is not expected before fall.