Regulatory Reform

Correcting the Net Metering Record

“There’s nothing so absurd that if you repeat it often enough, people will believe it.”
– William James

“A lie told enough becomes the truth.”
– Vladimir Lenin

Perhaps the most frequently used logical fallacy in the world of politics and public policy today is the argument of assertion, or the idea that someone can legitimately argue a point by merely declaring that something is true, regardless of contradiction. Thus far in 2014, the solar lobby and environmental activists have together employed this strategy to attack ALEC as a legislative membership organization and our stance on the issue of net metering reform.

The Alliance for Solar Choice (TASC), a lobbying organization comprised of the nation’s largest solar installers, and other similar groups have routinely and willfully mischaracterized ALEC’s position on the role that distributed generation (DG) technologies should play in the future and the need for net metering reform in many states across the nation.  Furthermore, they have publicly declared victory over the passage of net metering legislation in a handful of states—including Utah and Kansas—that have supposedly been “ALEC defeats.”

Unfortunately for them, they couldn’t be more incorrect.

ALEC’s position on DG and net metering is pretty straightforward.  Electricity customers who value and can afford DG technologies should be free to install these systems on their homes or businesses.  At the same time however, these DG customers should pay for all costs associated with their decision to install and utilize these technologies and not shift the financial burden to non-DG customers. Using data provided by the Energy Information Administration (EIA), the Edison Foundation’s Institute for Energy Innovation estimates that DG customers shift up to $60 in non-energy grid services per month to non-DG customers.  Despite the barrage of attacks and the insistence of TASC and other solar lobbying groups, ALEC does not support the elimination of net metering programs.  Rather, ALEC encourages states to merely consider modest reforms.

The ALEC resolution on net metering encourages states to update their existing net metering programs by creating a fixed grid charge or other rate mechanism that will help preserve the integrity of the electric grid and promote more cost transparency for all electricity customers. In the states where ALEC has supposedly been “defeated,” we actually see steps in this positive direction.

The Utah State Legislature, for instance, passed SB 208, which would allow the Public Service Commission (PSC) to determine a charge or other ratemaking structure to address the cost shifting elements of net metering.  In other words, this legislation charges the PSC with determining whether or not the costs incurred by utilities and electricity customers as a result of the state’s net metering program outweigh the benefits.

Similarly, the Kansas Legislature passed HB 2101, which would credit DG customers for surplus generation at the utility’s avoided cost and allow a utility to propose a minimum bill, time-of-use rate, or other rate structure for DG customers.

In what has become an all-too-common theme, environmental activists routinely ascribe certain policy positions to ALEC that we as an organization do not hold.  ALEC recognizes the fact that more and more electricity customers are seeking DG (and other renewable technologies, for that matter) and does not oppose in principle or support the elimination of net metering programs in the states. In fact, ALEC’s position on the need for net metering reform is very much in line with the one espoused by the Natural Resource Defense Council.

Repeatedly turning ALEC into a boogeyman that opposes all that is good and right in this world may provide our detractors with some modicum of pleasure, but it’s an intellectually lazy exercise and wholly unproductive as states across the country continue to discuss and debate the most salient and pressing issues of the day.

In Depth: Regulatory Reform

In his first inaugural address, Thomas Jefferson said that “the sum of good government” was one “which shall restrain men from injuring one another” and “shall leave them otherwise free to regulate their own pursuits of industry.” Sadly, governments – both federal and state – have ignored this axiom and…

+ Regulatory Reform In Depth