Vermont Net Metering Rule Changes: What You Need to Know about Rule 5.100

Screen Shot 2016-04-14 at 12.07.25 PMBelow is info from a fact sheet released by the Energy Clinic at Vermont Law School about the Public Service Board’s proposed rule changes. Download the fact sheet along with a sample letter to the PSB here: Rule5.100-Fact Sheet

Vermont PSB Rule 5.100 Revisions – Net Metering

What to know about the PSB’s Proposed Net Metering Changes and how you can act to preserve your ability to go solar.

The Public Service Board is currently revising the net metering program (Rule 5.100). As directed by the Vermont legislature in Act 99, the PSB must design a revised program with input from impacted parties and the public.

The proposed rule makes a number of changes to the current net metering program that harm Vermonters who want to go solar:

  • Eliminates the solar adder, an additional credit for each kWh a solar system produces that is applied directly to a customer’s bill. The solar adder is currently between 4-6¢ per kWh, depending on the size of the system.

  • Replaces the adder with positive and negative “adjusters” for siting and renewable energy credits (RECs). Solar generation would be credited at the applicable residential retail rate, plus or minus the relevant adjusters.
  • The proposed REC adjuster will penalize solar customers who consume solar power from their own solar systems (the only way to “go solar”) rather than turning over their RECs to the utility. It will cost customers in total a 6¢ per kWh penalty to retain and retire their RECs in order to go “solar,” “renewable,” “clean,” or “green.” No other state penalizes a solar customer in this manner.
  • + 3¢ per kWh: Customers who transfer RECs to the utility will receive a 3-cent bonus, but will not consume solar energy from their panels and are legally prevented from making any renewable energy claims.
  • – 3¢ per kWh: Customers who retain and retire their RECs will have an additional 3-cents per kWh subtracted from the base net metering rate. These customers who reduce Vermont’s greenhouse gas emissions will be treated the same as a customer who sells their RECs out of state for additional profit.

Other changes to the rule include a new siting adjuster:

  • The proposed siting adjuster will increase or decrease the credit depending on a) size and b) a list of eight preferred siting criteria: a rooftop, parking canopy, brownfield, landfill, quarry/gravel pit, previously developed site, on the premise of the consumer of the majority of the electricity, or on a site approved by the town.
  • + 1¢ per kWh: Smaller than 15kW or smaller than 150 kW and on preferred siting listed above.
  •  0¢ per kWh: 150-500kW and on preferred siting.
  • – 2¢ per kWh: 15-150 kW, not on preferred siting.
  • – 3¢ per kWh: 150-500kW, not on preferred siting.

What stays the same:

  • Unused net metering credits will be forfeited to the utility without compensation after 12 months.

What the proposed rule means for existing solar installations:

  • Existing installations will receive their utility’s net metering rate on file with the PSB on December 31, 2016 for 20 years from the date system is installed.
  • Existing installations will receive solar adder for 10 years from date installed.
  • Existing installations will not be subject to the proposed adjusters.

What does this mean for Vermonters who want to go solar?

The Homeowner: Tom and Jan want to go solar and reduce their carbon footprint by installing a 5kW array on their home’s roof in GMP territory. Under the current rule they would receive $0.20/kWh. Under the new rule they would receive less than $0.13/kWh. For a typical family’s electric use, this would change the solar array’s payback period from 13 to 20 years.

The Town or Small Business: Residents of Barnard have voted to go solar and fund a bond to put a 30kW array on the roof of the town’s Emergency Services Building. Under the current rule, they would receive $0.19/kWh. Under the new rule, they would receive less than $0.13/kWh. For Barnard’s project this rule would change the payback period from 14 years to 22 years.

The Community Solar Group: A 150 kW community solar array planned for Richmond would receive less than $0.13/kWh if sited in a preferred location. Currently, that same size array receives $0.19/kWh. The proposed rule would change the payback period for Richmond’s ground-mounted community solar array from 9 years to 15 years—or longer if negative siting adjusters apply.

So what does this mean for Vermonters who want to go solar?

Vermonters who seek to go solar in 2017 and beyond will find that the economics are substantially worse than they are today. If the rule is finalized in its current form, many Vermonters will find that it makes significantly less financial sense to go solar.

Furthermore, honest solar installers would no longer be able to market their installation services as providing “solar” or “renewable energy” for customers who choose the most economical option. Vermonters interested in buying solar panels would be faced with a stark choice: either turn over your right to your solar power to the utility, or receive a substantial reduction in credit that undermines the fundamental economics of your solar array.

There is no sound policy reason for creating this dilemma, which will prevent Vermonters from going solar, harm honest solar companies and slow the adoption of solar energy in Vermont. No other state has provisions that economically force the solar customer to turn their RECs over to the utility:

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To comment on the proposed net metering rule:

  • Email written comments to: clerk@vermont.gov by May 12, 2016.
  • Attend a public hearing on Wednesday, May 4 @ 7:00 PM Montpelier HS Cafeteria, 5 High School Drive or Thursday, May 5 @ 10:00 AM PSB Hearing Room 112 State Street 3rd floor.
  • In addition you should copy your letter to your legislators. (See sample letter attached.)

The full-text of the proposed net metering rule (5.100) is available at: http://psb.vermont.gov/statutesrulesandguidelines/proposedrules/rule5100

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