Some worry net metering changes would throw shade on Iowa solar industry

Installing solar panels on a home or business to save on energy bills — by using net metering — could become less appealing for some Iowans.

That’s what solar and environmental groups say about Alliant Energy’s proposal for a three-year, net metering pilot program, which is slated to take effect April 1.

The groups have asked the Iowa Utilities Board for another hearing on the proposed change, which would apply only to new net metering customers.

Net metering allows homeowners and businesses that generate their own power to get credit for the energy they send back to the electric grid, thereby lowering their utility bill.

Alliant officials say Iowa’s rules for net metering need to be adjusted to create more balance between solar users and other customers so that solar customers are paying their fair share to maintain the electric grid.

But Tyler Olson, president of Cedar Rapids-based Site Gen Solar, said one of Alliant’s proposed changes would lower the cap on how much energy customers can net meter.

That, he said, could have a “serious chilling effect” on Iowa’s solar industry.

The change, “for all intents and purposes, ends net metering,” Olson said. “If net metering goes away, distributed generation goes away, solar on your roof goes away.”

ALLIANT: LONG HAUL

Alliant senior vice president Douglas Kopp said the pilot program is a stepping stone in the utility’s plan to find the best way to manage Iowa’s growing solar network.

“We didn’t intend for this pilot to be something that stalls solar development. We are supportive of solar,” Kopp said. “Now is the time to figure out what the sustainable solution is for solar technology. … What is it that is going to work for the long haul?”

Allilant has more than 1,300 customers who net meter,

One reason for the change, Kopp said, is the utility’s need to reach a balance between solar customers and its other customers. The goal is to create a program that sees solar users — who also make use of the electric grid — pay a fair share of the grid’s maintenance costs, he said.

“All of us pay for the system grid, and we pay for that through our kilowatt-hour charge,” Kopp said. “We’re not anti-solar, but we are working at trying to figure out how to best integrate it into our system.”

WHY THE CHANGE

The Iowa Utilities Board in 2015 ordered the state’s two main utilities, Alliant and MidAmerican Energy, to draft net metering pilot programs to expand statewide distributed generation — energy produced at or near the location it is used.

For Alliant, some of the main proposals include expanding the number of solar systems eligible for net metering and requiring customers to cash-out excess energy credits annually.

Don Tormey, spokesman for the Iowa Utilities Board, said Friday the board is reviewing the Alliant and MidAmerican proposals.

Last month, the board indicated the pilot programs would become effective April 1. The board plans to re-evaluate the programs in three years.

CRITICS: A THREAT

But the net metering cap has some consumers worried.

Current rules cap the energy a customer can net meter at how much energy the customer uses in a year.

Alliant’s proposal would establish a cap based on average demand calculations and would place customers in specific classes.

“That would be all well and good, but for the typical homeowner and typical small business owner, they don’t even know what your demand is,” said Josh Mandelbaum, staff attorney with the Environmental Law and Policy Center. “So instead of capping it on your individual demand … they base it on this class load average.”

Troy Van Beek, with Fairfield’s Ideal Energy, said that change would reduce the amount of energy residential customers could net meter by 62 percent and by 68 percent for small business customers.

It will make solar much less attractive to potential investors because, he said, solar installations yielding more than the cap won’t make financial sense.

“This ruling would really pretty much shut down the residential market altogether,” Van Beek said.

In February, seven entities filed a petition with the Iowa Utilities Board asking for a rehearing on the pilot programs. Those joining in the petition were the Environmental Law and Policy Center, Iowa Environmental Council, Sierra Club, Iowa Solar Energy Trade Association, Solar Energy Industries Association, Vote Solar and Winneshiek Energy District.

Alliant’s Kopp said individuals with questions regarding Alliant’s wind and solar programs should contact Alliant’s energy renewable hotline at (800) 972-5325.