The table below is from lobbyists working to pass the solar bill, House Bill 589 (Competitive Energy Solutions for NC). They sent this handy little “fact sheet” on the bill to me, and apparently legislators. It passed the House and is parked in the Rules Committee in the NC Senate. After the budget passes, expect to see movement on the bill, so I wanted to get this information out and ask for your help.
I am asking for everyone to read the below information and weigh in on any area you want to comment on or have particular information concerning. I know there are a lot of smart people out there who know a lot about this issue. You can respond in the comment section or if you wish to do so privately, send an email to francis.deluca-at-nccivitas.org.
The bold numbers next to “What lobbyists Say is Myth” paragraphs is for reference in your replies.
As I said in one of my first posts on this bill “the skids have been greased.” If there is no significant opposition to this bill, it will pass. The number of lobbyists working on this bill employed by Duke Energy and the Solar companies is overwhelming. You can search for them yourself here.
| What Lobbyist Say is Myth | What Lobbyist say is Fact |
| 1. The ratepayers are going to be on the hook to pay for the stakeholders’ grand plans in HB 589. | · Without HB 589, customers of all types will pay more.
· HB 589 finally reforms the Jimmy Carter-era federal mandates that created a distorted marketplace and artificially high costs for renewable energy in North Carolina. HB 589 modernizes our state’s energy system through competitive, market-driven reforms resulting in significant savings for ratepayers by: 1) Reducing the mandated standard contract from 5,000 kw to 100 kw. 2) Reducing the standard contract length from 15 years to 10 years. 3) Eliminating the requirement for the utility to pay for capacity when it is not needed. 4) Preventing the utility from entering PURPA negotiated (non-standard – for more than 100 kw) contracts for a term greater than five years. · HB 589 will save customers approximately $850 million. · HB 589 also reforms today’s net metering policy, which requires utilities to buy excess generation supplied by solar customers. · The required price paid is the full retail rate for electricity which is about 3-1/2 times more than it costs the utility to generate the power themselves. · Under today’s antiquated net metering policy, non-solar customers are forced to subsidize solar because fixed costs are transferred from solar to non-solar customers. |
| 2. HB 589 is not competitive and could negatively impact North Carolina ratepayers for years to come. | · The market-driven reforms in HB 589 will help rein in the current unconstrained growth of solar saving electric customers in North Carolina an estimated $850 million over the next decade through increased fuel savings and reduced purchase power costs. Without HB 589, customers of all types will pay more.
· At the end of the competitive procurement period included in HB 589, renewable resources will be required to stand on their own as the lowest cost options in order to be constructed and used as an infrastructure asset. |
| 3. The bill is almost 100 percent dedicated to promoting solar power. | The continued growth of solar at the current level—at higher costs in this haphazard manner—is not sustainable. This bill injects competition into the renewable energy market and lowers customer costs by:
· Reducing the cost caps on the REPS Rider for residential customers from $34 per year to $27 per year; · Reducing total costs by $850 million over the next 10 years; · Eliminating subsidization of solar consumers and providing new and enhanced programs to help customers save money on electricity bills; · Enhancing economic development and job growth in the state with a program that helps large customers support their sustainability goals. |
| 4. The bill includes a set aside for the environmental non-profit NCGREENPOWER. | · NCGREENPOWER is a non-profit organization that is primarily funded through voluntary customer donations that funds solar generating systems for NC schools.
· This small carve-out to NCGREENPOWER is only 0.25% of the total rebates which will be offered to all customers over the next five years. · This will help NCGREENPOWER fund solar systems for up to 50 schools over the five-year period. |
| 5. This bill was rolled out in Committee and passed in less than 45 minutes with no time for full debate and consideration. | · Stakeholders, representing electricity providers, utilities, customers, economic development and renewable energy, have been meeting for nearly a year to negotiate reforms to help modernize the state’s energy policies. |
| 6. Civitas was not invited to be part of stakeholder meetings on HB 589. | · Starting in September 2016 stakeholder meetings were open – anyone could attend. (Civitas obviously missed the public notice about these meetings – my note, not lobbyist’s, FXD) |
| 7. The Solar Rebate Program is very similar to the expired tax credits NC was offering, but in this case utility customers will be paying for them on their electric bills. | · The modest proposed rebate program will reduce dependence on utility owned centrally located generating stations. |
| 8. Residents who are not installing solar are subsidizing those who are installing solar. | · Under today’s antiquated net metering policy, non-solar customers are forced to subsidize solar because fixed costs are transferred from solar to non-solar customers.
· The common-sense reforms in HB 589 will set new rates for net energy metering to ensure only solar customers are paying the cost of being connected to the grid. |
| 9. North Carolina has repeatedly failed to land a large manufacturing facility in recent years. Could this be because we have utility rates that are rising and the renewable mandate in the Southeast? | · Utility rates in North Carolina are 20% below the national average.
· HB 589 will ensure customers continue to pay competitive rates and encourage further economic growth in North Carolina. · HB 589 also expedites the connection of generators that utilize fuel derived from swine and poultry waste, which will help farmers manage the environmental impact in the state and will help to expand agriculture in NC. |
| 10. North Carolina is number two in the country in installed solar. Remember, every installed solar-generating facility must have a backup generating facility, usually fossil fueled. Because the backup facility is not run at optimum efficiency, due to varying solar facility output, it usually puts out more pollution than another facility operating continuously. | · The unconstrained growth of solar in North Carolina is a result of the overly generous Carter-era federal PURPA mandates.
· The competitive process proposed in HB 589 will finally force developers to bid competitively to supply solar to the utility. · Today, we only know the price paid to solar sellers is enough because we have so much. (the equivalent of about five nuclear plants waiting to come online) · Under HB 589, solar developers will be forced to bid competitively and if the price they bid is not low enough, they will not have the option to sell power to the utility. · Competitive forces will help drive down the price of solar, improve efficiency and enhance innovation. · Competitive processes force suppliers to bid at or near their marginal cost in order to receive the privilege of selling energy to the utility. |
Would you buy or pay for something that works 30-40% of the time? I asked that question of the audience during a Candidates forum last year. I had to repeat the question asking for a show of hands of those who would buy or pay for something that works 30-40% of the time! No body raised their hands and I went into the anti-free market aspects of the 2007 Reneweable Energy Portfolio mandated by state law!
I have been fighting industrial solar and wind energy projects for the past four years. In particular, I am concerned about Chowan County – my home – but also about our State as a whole. The logic of the fight is inescapable: solar and wind are intermittent, non-dispatchable, are a blight on the landscape and, particularly wind, pose a proven danger to the health, safety and financial welfare of citizens. Although developers try to avoid the issue, both solar and wind require 100% backup by on-line conventional power generators. Both wind and solar projects openly admit that they will be removed – “decommissioned” – at the end of their economic life, but no mention is ever made about replacing the generating capacity lost upon such decommissioned. The reason for that omission is that both solar and wind facilities are totally redundant and completely unnecessary and their sole reason for being is economic advantage granted by the mandates of the Renewable Energy Portfolio requirements, tax credits, accelerated depreciation and subsidies. Developers’ promises of bountiful tax income to the relatively poor counties where they are being built are chimerical and undefined. And they destroy the agricultural usefulness of the land. The only reasons for their existence is the misguided belief of the ignorant that they will help the environment and avarice and greed on the part of the unscrupulous. Unfortunately, a good number of our legislators fall into one or both categories.
First of all, remember that Duke just came in with a request to increase our rates by some 17% to pay for costs they have already incurred accomodating more solar than any other state in the country except CA (we may even be beating them on a per-capita basis). Duke also said they would be coming in with another rate hike of some 20% next year for more grid modernization needed for solar. They have not yet asked for more money to cover the ash costs.
Now, we have this – a bill that every solar lobbyist and Duke absolutely loves! A bill that was negotiated without anyone there to represent the residential ratepayer. Remember, Duke makes some 11% profit on any capital project – including solar and gas plants needed to back solar up.
I am trying to make sense out of some of the lobbyists’ statements. I think when they say, we would pay more than without the bill, and when they say we will save $850 million, that they are saying the same thing. That is, if the current public utilities commission (PUC) policy stays like it is, we will overpay $850 million more than we are already overpaying. Duke testified and so did Dominion, that under current PUC policy, NC goes well beyond all other states in the US in implementing PURPA – a federal law that seeks to encourage certain types of electricity generators – by (1) granting non-negotiated contracts to solar farms greater than 100kW (all the way up to 5000kW) that requires us to buy the power whether we need it or not, and (2) over paying for electricity generated by solar farms by using an outdated electricity rate. As a consequence of these two, Duke and Dominion said we have been over paying by $1.4 billion ALREADY. The first of these will be fixed by this bill but the second will be extended.
So, in a sense, this is what they are saying – folks, the PUC really, really, messed up so far and you ratepayers have been left with an over-payment of $1.4 billion. Guess what, with this bill you all will be over charged some more – a lot more because we are going to extend the too-high rate the PUC awarded some years ago for 18 months longer (at least). BUT – good news, the over charge will not be quite as high in the future because we are going to finally use the same cutoff (100 kW instead of 5000 kW) as the rest of the country. Now, why don’t you support this bill?