Duke Energy’s proposed net metering changes mean some homeowners would find challenges in how to save energy and money, and some solar companies would find challenges in growing their businesses. In a November 29, 2021 petition to the NC Utilities Commission, Duke Energy asked for a number of changes, in what has been termed Net Metering 2.0. The proposal comes in the wake of House Bill 951, signed into law in October 2021 by Gov. Roy Cooper (D). The new law and previous 2017 legislation in House Bill 589 directed state regulators to re-evaluate net energy metering policies.
What is Net Metering 2.0?
This is a complex question with complex answers, given how many moving parts are involved. Net metering 2.0 includes switching to time-of-use rates, critical peak pricing, minimum bill, complicated netting procedure, non-bypassable charges, and variable treatment of existing customers. Duke Energy has a number of elements it considers beneficial to the customer, especially those with all-electric homes and electric vehicles. Duke has combined the proposed net metering changes with Duke Energy’s Smart Saver proposal that would provide a rebate to solar customers who also install a smart thermostat. The proposed agreement includes time-of-use (TOU) retail rates based on time of day and when Duke is experiencing peak demand. The plan includes a night-time discount period to encourage customers to charge electric vehicles (EV) overnight.
Who Would Benefit from the Changes?
Well, Duke Energy for one. Encouraging all-electric households and TOU retail rates and having the means to control demand makes Duke more money and makes it easier to predict energy use. Advocates for the changes cite pathways to rooftop solar adoption and EV charging, as well as for providing incentives for residential solar customers to use smart thermostats, battery storage, and more. NC is the second state where Duke has developed a comprehensive net metering plan. And the debate on net metering changes in other states, most famously California, has instigated discussion on who will benefit. According to a consortium of local solar installation companies in NC, the list of benefactors is short. And the list of those whose pocketbooks and businesses will be adversely affected is long.
Who Would Be Adversely Affected by Net Metering 2.0?
The consortium of fifteen solar companies, led by long-time local installers Yes Solar Solutions (Cary, NC), Southern Energy Management (Raleigh NC), and Sundance Power (Weaverville, NC), and joined by 50 non-profits, on Thursday sent a letter to NC Governor Roy Cooper, NC Attorney General Josh Stein, and the NC Utilities Commission, outlining our opposition to Duke Energy’s proposed changes. (Read the letter in its entirety here.) We believe it could harm the growing solar industry in NC, impact thousands of well-paying jobs, threaten the well-publicized energy goals for the State of NC, and limit the delivery of low-cost power to the grid, which affects all electricity customers. Yes Solar Solutions Co-Founder and President Stew Miller is quoted in PV Magazine’s article on the letter, saying that Duke is “following the playbook that utilities in California and Florida are using to slow the growth of their only competitors … their current ratepayers that want the freedom to generate a portion of their own electricity.”
What Would the Impact Be on Homeowners?
Complexity. The time-of-use rates, critical peak pricing, minimum bill, complicated netting procedure, non-bypassable charges, and variable treatment of existing customers create such complexity that it would become quite difficult for our customers to determine what the payback on their solar investment would be, or for a solar company to model for them. The value of solar to a homeowner could be reduced by as much as 25%-35%.
Discrimination. The proposed changes would discriminate against certain groups of ratepayers. First, owners of rooftop solar systems would be subject to additional fees not charged to other residential customers. In addition, the proposed incentive (Duke Energy’s Smart Saver proposal that would provide a rebate to solar customers who also install a smart thermostat) is available only to all-electric households, despite the fact that the demand response potential from a smart thermostat exists for any household that heats or cools with electricity, even if other appliances run on gas. Thus, the key incentive in Duke’s proposal would leave gas-using customers with a payback on their solar investment that’s years longer than those who are all-electric households.
What Would the Impact Be on Local Solar Companies?
Jobs. Our 15 companies employ local people with full-time jobs, most with benefits like health care, paid time off, training and 401(k) plans that pay local taxes and buy local goods to support their families and contribute to the NC economy. The afore-mentioned debate in California could cost the solar industry there up to 50,000 jobs. If the affordability of solar goes down, growth follows and so do jobs.
Climate Goals. The rooftop solar industry could be a growing player in the climate goals set by Gov. Cooper. While utility-scale solar growth has slowed, customer-owned solar has grown and has huge potential. But not if our companies are stymied by the inability to save our customers money, or even figure out how to help show them if they can save due to the complexities of rates. Our fifteen companies have made a major contribution to the economy, to our customers, to our employees, and to the climate. We are requesting that Gov. Cooper, Attorney General Stein, and the NC Utilities Commission carefully consider the impact Duke’s proposed net metering changes would have on all of us.
What Can a Consumer Do About Net Metering Changes?
If ever there was a time to invest in solar, it is now before any more net metering changes take effect. The potential of a solar array’s affordability going down in the future can still be offset. Those customers that are on the fence or were thinking of putting off purchasing their solar system until next year should reconsider and move forward now, so as to be grandfathered in the current net metering rider for the next 5 years. At that time, January 1, 2027, they have the option to remain on non-TOU rates until 2037 with a $10 increase in their monthly minimum bill and non-bypassable charges of between $.36/KWdc for DEC customers and $.42/KWdc for DEP customers. A 9kW system owner would incur a $3.24 non-bypassable charge in DEC territory for example.
Call or contact one of the local solar companies in the attached letter and find out now what solar would cost and how it could benefit you now. We have taken a stand on your behalf and would welcome your support!