'It’s politics at work to help a few keep their money,' says solar owner cut out of Nevada net metering plan
By Kim Brunhuber, CBC News
These solar panels generate enough electricity to power
more than 1,300 homes, and will enable MGM's chain of hotels to unplug
from the grid, at a huge cost to the power utility.
Kim Brunhuber
"Just look at its physical size," says MGM's chief sustainability officer Cindy Ortega from high atop the Delano hotel which overlooks the arrays. "We have a lot of sunshine here and we want to take advantage of that renewable energy."
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"At the hottest part of the day, it produces enough power to power 1,350 customers of the Nevada utility," Ortega says.
MGM now plans to obtain some of its energy from its solar installations and other renewable resources, and buy the rest on the wholesale market.
Fantastic, if you're a fan of clean energy. Disaster, if you're privately owned Nevada power utility NV Energy. Seven per cent of its revenue will disappear when the hotel chain pulls the plug, but the utility wouldn't allow that to happen without a fight.
MGM to compensate utility
After a protracted legal battle with NV Energy, MGM has now agreed to cough up $87 million to make up the shortfall."What that money goes towards is making sure all the other ratepayers here in southern Nevada aren't harmed or don't have higher power bills because MGM left the grid," says Ortega.
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Judi Penna says the net metering option was
'a beautiful plan, where everybody got a little bit of the savings.' And
then the utility company tried to cancel it. (Kim Brunhuber/CBC)
Last year she heard about what she calls "a beautiful plan." It's known as "net metering;" if you install solar panels you can earn credit by sending excess energy back to the power company.
"I jumped on it!" she says. "But that‚" she says, pointing at her roof, "is only half the panels I need."
Net metering scrapped as panels half installed
She had panels installed on the right half of her roof. Then the Nevada power utility suddenly scrapped the deal. With so many people switching to solar, the utility said it was losing revenue and would have to pass the costs off to its non-solar customers. Instead it chose to slash the amount of credit solar customers like Penna got for selling electricity back to the system, effectively cancelling the net metering program. And elected officials did nothing to stop it, she says.
Nevada is the sunniest state in the U.S., but
the adoption of rooftop solar has come to a virtual standstill because
the utility company cancelled its program to pay for excess electricity
from solar. (Kim Brunhuber/CBC)
With that, the consumer solar industry in the country's sunniest state was basically shut down.
As of June of this year, there are approximately 30,000 rooftop solar customers in Nevada, producing more than 265 megawatts of electricity, about three per cent of NV Energy's peak demand.
The impact of the utility's decision to end net metering can be seen at SolarCity, which last year was selling solar panels in Nevada faster than the company could install them.
"So we're here in SolarCity's call centre," says Chandler Sherman, the company's spokeswoman, as she walks down an aisle between dozens and dozens of cubicles. About 200 salespeople are on headsets, some sitting, some standing, some walking, almost all of them trying to convince someone to go solar.
Sales of panels in Nevada dive
"They are selling solar around the country but they can't sell solar to their own neighbours here in Nevada because of the policy decision that made solar unaffordable for Nevadans," Sherman says.
Salespeople at this call centre used to sell
about 1,400 rooftop systems a month in Nevada. Now they sell 15. (Kim
Brunhuber/CBC)
At a nearby SolarCity warehouse, there's only one worker and one empty truck. Inside are dozens and dozens of solar panels with names taped to them; panels that were destined for Nevada customers who no longer want them.
At this SolarCity warehouse, hundreds of solar panels await delivery to customers who no longer want them. (Kim Brunhuber/CBC)
"What you're seeing across the country is that demand — energy demand — is no longer growing," Bromley says.
Utilities' market share shrinking
The utilities' total market share is shrinking, he says, "and that is a threat to their business model."When the utility companies complain that solar customers aren't paying their fair share, Bromley believes they have a case.
"It gets to a tipping point where ultimately customers who install systems later are quite a burden to the system," Bromley says. "There's investment in the network which someone needs to pay for. They're no longer procuring energy from the utility, it's ultimately borne by the rest of the ratepayers."
Predictably, the solar companies see things a little differently.
Chandler Sherman, a spokeswoman for
SolarCity, says instead of adapting to new technologies, the utility
companies are blaming rooftop solar customers. (Kim Brunhuber/CBC)
This past week at a recent solar power trade show in Las Vegas, several CEOs worried openly about what the trend would mean for the industry across the U.S.
Solar needs a strategy
Guy Sella, CEO of SolarEdge, is calling for federal guidelines to help both the conventional power utilities and the solar industry find a way to co-exist."We saw the change in Nevada, and we understand that what we do today puts lots of pressure and risk on the utilities after investments of hundreds of billions over 130 years," Sella said.
David Kaiserman, whose company builds homes
with solar panels installed, says the solar industry is as disruptive as
Uber and should market itself as aggressively as Apple. (Global
Exposition Services)
Disruptive technology means change
"It's a disruptive technology that causes pain as all disruptive technologies do." To survive, solar should start marketing itself as aggressively as Apple or Google, he says."The symptom is what you see here in Nevada," Kaiserman said. "We're going to eliminate an industry where we induced people into putting solar on the roof and then we said, 'Ooh by the way the contracts that we told you — these 20-year leases that we said were great, that we gave you a rebate for and made you real comfortable about — oh, those stopped.' Those types of things are nonsensical. But they're born from the fact that there isn't a counter-balancing consumer viewpoint that says 'look this is what we want, this is what we demand as a society.'"
In Nevada, at least one part of Kaiserman's wish has been granted. The net metering program was wildly popular and there was political pressure to restore it. Nevada's governor came out in favour of a deal that would bring back the old rates NV Energy had been paying solar customers, though only for the panels that have already been installed. On Friday, regulators approved the deal.
Penna greeted the announcement with a shrug.
The new decision to 'grandfather' existing
solar panels under the old net metering agreement means nothing for the
other half of Penna's roof. (Kim Brunhuber/CBC)
After all, the new deal is great for half of her roof. But not the other.
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